THE  PLACE  OF 
AGRICULTURE  IN 
RECONSTRUCTION 

A  Study  of  National  Programs 
of  Land  Settlement 


JAMES  EMORMAN 


THE 

PLACE  OF  AGRICULTURE 
IN  RECONSTRUCTION 

A  Study  of  National  Programs  of 
Land  Settlement 


BY 

JAMES  B.  MORMAN,  A.M. 

ASSISTANT  SECRETARY  OF  THE  FEDERAL  FARM  LOAN  BOARD 

AUTHOR  OF  "THE  PRINCIPLES  OF  RURAL  CREDITS,"  "THE  PRINCIPLES 
OF  SOCIAL  PROGRESS,"  ETC.,  ETC. 


NEW  YORK 

E.  P.  BUTTON  &  COMPANY 
681  FIFTH  AVENUE 


COPYRIGHT,  1919, 
BY  E.  P.  DUTTON  &  COMPANY 


All  Rights  Reserved 


licon 


.  Dept.  Econ.  I  A-   Main  L 


Printed  in  the  United  States  of  America 


TO  THOSE 
SOLDIERS,  SAILORS  AND  MARINES 

WHO  WOULD  BECOME 

FARMERS 

AND  THEREBY  PROMOTE 

NATIONAL  PROSPERITY  AND  SOCIAL  PROGRESS, 
THIS  BOOK 

is 
HOPEFULLY  DEDICATED 


PEEFACE 

One  of  the  primary  purposes  of  this  book  has  been 
to  formulate  a  practical  program  of  land  settlement 
in  the  United  States  for  discharged  soldiers,  sailors 
and  marines. 

In  studying  the  material  for  such  a  program,  the 
object  held  in  view  was  to  ascertain  the  elements 
which  make  for  success  in  farming  under  ordinary 
conditions.  To  induce  men  to  take  up  agriculture  as 
if  they  were  entering  the  gateway  to  the  Promised 
Land,  without  taking  into  consideration  all  the  pos- 
sibilities of  failure  as  well  as  of  success,  is  simply  to 
invite  misfortune  and  lend  assistance  to  social  un- 
rest. Consequently,  the  basis  of  successful  farming 
is  considered  as  to  climate,  crops,  live  stock,  land, 
labor,  capital  and  credit. 

Nor  has  the  study  been  confined  to  discharged 
service  men  from  the  military  and  naval  forces  of 
our  own  country  and  our  allies  in  the  great  war. 
Eather  the  inquiry  has  been  broadened  to  show  the 
present  and  future  needs  of  agriculture  and  the  fac- 
tors which  make  for  success  therein.  This  applies 
to  all  who  may  engage  in  farming  as  a  means  of 
earning  a  living. 

Where  the  study  is  directly  related  to  discharged 

V 


vi  Preface 

service  men,  the  term  "  soldier "  has  been  used  to 
embrace  any  line  of  military,  naval,  or  war  work. 
So  far  as  service  to  the  country  and  humanity  is 
concerned,  they  are  all  entitled  to  equal  considera- 
tion. When  these  men  and  women  change  their  uni- 
forms for  civilian  clothes,  there  is  no  distinction  be- 
tween soldiers,  sailors,  marines,  or  war  workers  of 
various  descriptions.  They  are  all  citizens  of  a 
common  country;  they  are  all  " soldiers "  in  the 
struggle  for  the  maintenance  of  civilization.  It  is 
with  this  broad  meaning  in  mind  that  the  term  ' '  sol- 
dier "  has  been  used  in  this  work. 

The  proposed  programs  of  land  settlement  for 
soldiers  in  other  countries  have  been  studied  with  a 
view  of  setting  forth  a  practical  plan  of  land  set- 
tlement in  the  United  States.  Our  country  will  be 
passing  through  a  critical  period  of  its  history.  The 
foundations  of  society  and  of  civilization  are  being 
tested  to  the  utmost.  The  peace  of  nations  as  well 
as  the  peace  of  the  world  is  at  stake.  The  part  that 
agriculture  plays  in  maintaining  national  welfare 
has  been  discussed  and  incidentally  the  foundations 
of  a  stable,  progressive  national  life  have  been  inti- 
mated. But  it  would  have  led  me  too  far  afield  from 
my  present  thesis  to  have  enlarged  upon  the  topic 
of  social  progress  in  its  relation  to  the  peace  of  the 
world.  That  study  has  been  reserved  for  a  subse- 
quent volume. 

For  material  relating  to  foreign  programs  of  land 


Preface  vii 

settlement  and  reconstruction,  the  writer  is  greatly 
indebted  to  the  officials  of  Canada,  Great  Britain, 
Australia,  New  Zealand,  France  and  other  countries 
who  kindly  placed  at  his  disposal  the  government 
documents  bearing  on  the  retraining  of  disabled  sol- 
diers in  agricultural  and  related  lines  of  work  as  well 
as  those  dealing  with  actual  land  settlement  schemes 
and  proposed  methods  of  financing  them.  In  this 
connection  particular  mention  is  made  of  Hon.  E.  E. 
Prothero,  chairman  of  the  Board  of  Agriculture  and 
Fisheries,  London;  his  Excellency,  Hon.  Jules  Jus- 
serand,  French  Ambassador  to  the  United  States, 
who  generously  cabled  to  Paris  for  laws  and  related 
documents  on  the  above  subjects ;  and  M.  Sartiges, 
the  secretary  of  the  French  Embassy,  who  very 
graciously  compared  my  translations  with  the  orig- 
inal documents  and  made  several  serviceable  cor- 
rections. Only  by  such  aid  was  the  preparation  of 
this  book  made  possible  and  the  fact  is  hereby  grate- 
fully acknowledged. 

With  the  great  problems  of  reconstruction  the  na- 
tions of  the  earth  will  wrestle  for  a  long  time  to  come. 
If  this  little  book  shall  play  its  part  in  throwing 
some  light  on  reconstruction  and  in  giving  encour- 
agement to  those  who  would  take  up  farming  for  a 
living,  my  task  will  not  have  been  in  vain. 

J.  B.  M. 
Kensington,  Md., 

May,  1919. 


CONTENTS 

CHAPTER  PAGE 

I.    LABOB  PROBLEMS  ON  THE  RETURN  OF  PEACE        1 
II.    THE  ROMAN  LAND  SETTLEMENT  SYSTEM  FOB 

SOLDIERS  AND  ITS  LESSONS        ....       32 

III,  PROPOSED  SYSTEMS  OF  LAND  SETTLEMENT  IN 

GREAT  BRITAIN 45 

IV.  ANALYSIS  OF  THE  LAND  SETTLEMENT  PROBLEM 

IN  GREAT  BRITAIN 68 

V.    ENCOURAGEMENT  OF  LAND  SETTLEMENT  IN 

FRANCE 87 

VI.    ANALYSIS  OF  THE  FRENCH  SYSTEM  OF  FINANC- 
ING LAND  SETTLEMENT Ill 

VII.    LAND  SETTLEMENT  BY  RETURNED  SOLDIERS 

IN  CANADA 146 

VIII.    LAND   SETTLEMENT   FOR   SOLDIERS   IN   THE 

UNITED  STATES 181 

IX.    A  PROGRESSIVE  POLICY  OF  LAND  SETTLEMENT    219 
X.    THE   FUTURE   SUPPLY  OF  FARM  LABORERS 

AND  TENANT  FARMERS 252 

XI.    THE  SOURCES  OF  CREDIT  FOR  SUCCESSFUL 

AGRICULTURE 283 

XII.    THE  PROBLEM  OF  RURAL  CREDITS  IN  THE 

UNITED  STATES 310 

XIII.    THE  RECONSTRUCTION  OF  AGRICULTURE  AND 

ITS  RELATION  TO  NATIONAL  WELFABE          348 


CHAPTEE  I.— LABOR  PROBLEMS  ON  THE 
RETURN  OF  PEACE 

With  the  advent  of  peace,  what  shall  be  done  with 
our  returned  soldiers  7  That  is  one  of  the  most  im- 
portant questions  facing  the  world  to-day. 

Statesmen  cannot  shut  their  eyes  to  the  fact  that 
a  period  of  industrial  stagnation  is  likely  to  occur 
when  nations  are  at  peace  once  more  and  address 
their  energies  to  the  readjustment  of  their  labor 
forces.  Such  a  condition  seems  almost  inevitable. 
For,  in  addition  to  the  cessation  of  many  indus- 
tries due  to  the  war  which  has  resulted  in  new  ad- 
justments of  labor,  the  enormous  business  of  manu- 
facturing war  supplies  will  cease.  Also  the  wheels 
of  many  industries  related  to  war  supplies  will  re- 
volve no  more.  Consequently,  large  numbers  of 
well-paid  men  now  regularly  employed  will  be 
thrown  on  the  labor  market. 

The  labor  problem  will  be  intensified  because 
women  have  been  slowly  taking  the  places  of  men  in 
industrial  and  other  pursuits  during  the  past  few 
years.  .In  the  public  civil  service,  also,  girls  and 
women  have  not  only  been  doing  work  formerly  done 
by  boys  and  men,  but  their  number  has  been  in- 

i 


2     The  Place  of  Agriculture  in  Reconstruction 

creased  by  thousands.  They  have  forsaken  their  cus- 
tomary employment  to  take  up  work  directly  or  in- 
directly connected  with  the  war. 

There  will  have  to  be  new  adjustments  of  all  these 
labor  forces  when  the  war  is  over.  These  adjust- 
ments will  ramify  into  every  economic  enterprise 
and  every  form  of  social  service.  The  labor  problem 
in  intensified  form  we  must  face  in  the  future.  States- 
men recognize  it  and  are  looking  forward  to  find  a 
satisfactory  solution  of  the  problem.  For  it  is  one 
that  will  be  with  us,  not  for  a  month  or  a  year,  but 
probably  for  many  years  before  anything  like  normal 
industrial  and  business  conditions  will  prevail. 

To  these  economic  and  industrial  conditions  there 
will  be  added  the  return  of  millions  of  soldiers  and 
other  war  workers,  male  and  female.  At  the  call  of 
their  country  these  men  and  women  left  the  school 
and  university,  the  desk,  factory  and  field,  and  every 
walk  of  professional  life.  The  returned  soldiers  and 
war  workers  will  have  a  large  place  in  the  hearts  of 
their  fellow  citizens.  For  them  proper  provision 
should  be  made  in  the  way  of  employment  and  home- 
making.  They  will  doubtless  need  and  yearn  for 
both.  And  the  question  is — What  part  can  the  gov- 
ernment play  in  meeting  all  these  conditions  and 
contingencies  ? 

The  countries  at  war  have  not  been  idle  in  formu- 
lating plans  for  the  training  and  absorption  of  this 
great  influx  of  labor  forces.  The  problem  has  been 


Labor  Problems  on  the  Return  of  Peace      8 

thrust  upon  them.  Thousands  of  wounded  and 
maimed  soldiers  have  been  returned  to  their  own 
lands  and,  when  recovered,  have  found  themselves 
unfitted  to  earn  their  living  at  their  previous  occu- 
pations. They  have  had  to  be  trained  anew,  to  be 
fitted  with  specially  devised  artificial  limbs  in  order 
to  perform  manual  labor.  Blind  soldiers  have  been 
made  to  see,  as  it  were,  by  being  taught  to  weave  rugs 
and  baskets  and  to  learn  many  other  useful  occu- 
pations. Vocational  training  had  to  be  undertaken 
for  both  the  lame  and  the  blind.  The  object  was  to 
fit  men  for  the  general  industrial  life  of  modern 
society. 

But  all  these  mediums  for  training  will  only  in- 
tensify the  industrial  labor  problem.  This  fact  is 
recognized.  The  governments  of  the  allied  nations 
have  long  had  the  subject  of  labor  adjustment  after 
the  war  under  consideration.  Trade  unions,  labor 
organizations,  the  socialist  labor  party,  and  similar 
bodies  have  passed  resolutions  and  issued  mani- 
festos relating  to  the  problems  of  employment  and 
unemployment  after  the  war.  It  is  a  matter  of  pro- 
found public  interest.  The  British  Labor  Party 
and  the  Interallied  Socialists  have  both  attempted  to 
formulate  constructive  programs  for  the  guidance  of 
legislators  in  the  various  countries.  Mr.  Arthur 
Henderson,  England's  foremost  socialist  and  former 
member  of  the  British  cabinet,  speaking  for  his  so- 
cialist group,  has  declared  that  "the  task  of  finding 


4     The  Place  of  Agriculture  in  Reconstruction 

employment  for  disbanded  fighting  men  and  dis- 
charged munition  workers  we  regard  as  a  national 
obligation.  We  shall  see  to  it  that  work  is  found  for 
all,  that  the  work  is  productive  and  socially  useful, 
and  that  standard  rates  of  wages  shall  be  paid  for 
this  work." 

A  Suggested  Socialist  Program 

The  Interallied  Socialist  and  Labor  Conference 
held  at  London  in  the  spring  of  1918,  which  was  at- 
tended by  delegates  from  Great  Britain,  France, 
Italy,  Belgium,  South  Africa,  Kumania,  and  the 
South  Slavic  States,  took  up  the  subject  of  post-war 
industrial  labor  problems  in  great  detail.  In  the 
manifesto  issued  by  that  conference  the  following 
program  is  presented  for  the  employment  of  re- 
turned soldiers  and  sailors  in  public  works  and  the 
restoration  of  devastated  areas: 

"The  Interallied  Conference  insists  that,  in  view 
of  the  probable  world-wide  shortage,  after  the  war, 
of  exportable  foodstuffs  and  raw  materials,  and  of 
merchant  shipping,  it  is  imperative,  in  order  to  pre- 
vent the  most  serious  hardships,  and  even  possible 
famine,  in  one  country  or  another,  that  systematic 
arrangements  should  be  made  on  an  international 
basis  for  the  allocation  and  conveyance  of  the  avail- 
able exportable  surpluses  of  these  commodities  to 
the  different  countries,  in  proportion,  not  to  their 
purchasing  powers,  but  to  their  several  pressing 


Labor  Problems  on  the  Return  of  Peace      5 

needs;  and  that,  within  each  country,  the  govern- 
ment must  for  some  time  maintain  its  control  of  the 
most  indispensable  commodities,  in  order  to  secure 
their  appropriation,  not  in  a  competitive  market 
mainly  to  the  richer  classes  in  proportion  to  their 
means,  but  systematically  to  meet  the  most  urgent 
needs  of  the  whole  community  on  the  principle  of 
'no  cake  for  any  one  until  all  have  bread.' 

11  Moreover,  it  cannot  but  be  anticipated  that,  in 
all  countries,  the  dislocation  of  industry  attendant 
on  peace,  the  instant  discharge  of  millions  of  muni- 
tion makers  and  workers  in  war  trades,  and  the  de- 
mobilization of  millions  of  soldiers — in  face  of  the 
scarcity  of  industrial  capital,  the  shortage  of  raw 
materials,  and  the  insecurity  of  commercial  enter- 
prise— will,  unless  prompt  and  energetic  action  be 
taken  by  the  several  governments,  plunge  a  large 
part  of  the  wage-earning  population  into  all  the  mis- 
eries of  unemployment  more  or  less  prolonged.  In 
view  of  the  fact  that  widespread  unemployment  in 
any  country,  like  a  famine,  is  an  injury  not  to  that 
country  alone,  but  impoverishes  also  the  rest  of  the 
world,  the  conference  holds  that  it  is  the  duty  of 
every  government  to  take  immediate  action,  not 
merely  to  relieve  the  unemployed,  when  unemploy- 
ment has  set  in,  but  actually,  so  far  as  may  be  practi- 
cable, to  prevent  the  occurrence  of  unemployment. 
It,  therefore,  urges  upon  the  labor  parties  of  every 
country  the  necessity  of  their  pressing  upon  their 


6     The  Place  of  Agriculture  in  Reconstruction 

governments  the  preparation  of  plans  for  the  execu- 
tion of  all  the  innumerable  public  works  (such  as 
the  making  and  repairing  of  roads,  railways,  and 
waterways,  the  erection  of  schools  and  public  build- 
ings, the  provision  of  working-class  dwellings,  and 
the  reclamation  and  afforestation  of  land)  that  will 
be  required  in  the  near  future,  not  for  the  sake  of 
finding  measures  of  relief  for  the  unemployed,  but 
with  a  view  to  these  works  being  undertaken  at  such 
a  rate  in  each  locality  as  will  suffice,  together  with 
the  various  capitalist  enterprises  that  may  be  in 
progress,  to  maintain  at  a  fairly  uniform  level  year 
by  year,  and  throughout  each  year,  the  aggregate 
demand  for  labor  and  thus  prevent  there  being  any 
unemployed. 

1 1  It  is  now  known  that  in  this  way  it  is  quite  possi- 
ble for  any  government  to  prevent,  if  it  chooses,  the 
occurrence  of  any  widespread  or  prolonged  involun- 
tary unemployment,  which,  if  it  is  now  in  any  coun- 
try allowed  to  occur,  is  as  much  the  result  of  gov- 
ernment neglect  as  is  any  epidemic  disease. 

"The  Interallied  Conference  holds  that  one  of  the 
most  imperative  duties  of  all  countries  immediately 
peace  is  declared  will  be  the  restoration,  so  far 
as  may  be  possible,  of  the  homes,  farms,  factories, 
public  buildings,  and  means  of  communication 
wherever  destroyed  by  war  operations;  that  the 
restoration  should  not  be  limited  to  compensation  for 
public  buildings,  capitalist  undertakings,  and  ma- 


Labor  Problems  on  the  Return  of  Peace      7 

terial  property  proved  to  be  destroyed  or  damaged, 
but  should  be  extended  to  setting  up  the  wage 
earners  and  peasants  themselves  in  homes  and  em- 
ployment ;  and  that,  to  insure  the  full  and  impartial 
application  of  these  principles,  the  assessment  and 
distribution  of  the  compensation,  so  far  as  the  cost 
is  contributed  by  any  international  fund,  should  be 
made  under  the  direction  of  an  international  corn- 


mis  sion." 


It  will  be  observed  that  this  program  deals  almost 
wholly  with  public  service  enterprises  and  very 
little  with  industry  and  agriculture.  In  the  latter 
case  the  labor  of  returned  soldiers  and  sailors  is  to 
be  used  in  reclamation  projects,  land  afforestation, 
and  the  restoration  of  farms.  The  problems  are 
stated,  but  no  definite  plan  is  conceived  and  ex- 
pressed for  raising  the  funds  to  render  the  program 
effective. 

How  Labor  Unions  View  the  Problem 

The  laboring  classes  in  Great  Britain  have  clearly 
recognized  the  problems  which  will  confront  them 
not  only  immediately  after  the  return  of  peace,  but 
for  at  least  10  years  thereafter.  The  British  Labor 
Party  is  a  powerful  organization.  It  represents 
about  2,416,000  trade  unionists,  146  trade  councils, 
93  local  labor  parties,  10,000  members  of  the  British 
Socialist  Party,  35,000  members  of  the  Independent 
Labor  Party,  and  2,140  Fabian  socialists.  These 


8    The  Place  of  Agriculture  in  Reconstruction 

statistics  show  that  there  are  some  50,000  socialist 
members  out  of  nearly  two-and-a-half  millions  of 
union  workers. 

The  British  Labor  Party  met  in  June,  1918,  for 
the  purpose  of  drawing  up  a  program  of  reconstruc- 
tion. One  of  the  planks  of  its  program  was  gov- 
ernment control  of  the  nation's  agricultural  land.  It 
was  clearly  realized  that  cessation  of  the  war  meant 
a  flooding  of  the  labor  market  not  only  with  hosts 
of  discharged  industrial  war  workers,  but  also  with 
millions  of  demobilized  soldiers.  The  resolution  of 
the  congress  bearing  on  these  features  was  as  fol- 
lows: 

"This  conference,  realizing  the  grave  industrial 
conditions  which  will  take  place  with  demobilization, 
demands  that  the  same  careful  preparation  and  the 
same  sort  of  provision  should  be  made  in  advance 
for  a  systematic  replacing  in  situations  and  for  ade- 
quate maintenance  until  situations  are  found  with 
regard  to  the  three  million  civil  workers  in  war 
trades,  and  male  or  female  substitutes  for  men  now 
with  the  colors,  as  for  the  five  millions  to  be  dis- 
charged from  the  army." 

Here,  then,  was  a  proposal  aiming  at  the  socializa- 
tion of  industry.  War  workers  and  soldiers  dis- 
charged from  their  duties  are  to  be  provided  with 
employment  at  rates  of  wages  which  would  in  no 
way  diminish  the  prevailing  standard  of  living.  The 
government  is  to  be  used  for  changing  capitalistic 


Labor  Problems  on  the  Return  of  Peace      9 

competition  into  socialistic  cooperation.  This  atti- 
tude is  more  clearly  expressed  in  the  following  reso- 
lutions : 

"(1)  It  should  be  made  clear  to  employers  that 
any,  attempt  to  reduce  the  prevailing  rates  of  wages 
when  peace  comes,  or  to  take  advantage  of  the  dis- 
location of  demobilization  to  make  worse  the  condi- 
tion of  labor,  will  certainly  lead  to  embittered  indus- 
trial strifes  which  will  be  in  the  highest  degree  detri- 
mental to  the  national  interests ;  and  the  government 
should  therefore  take  all  possible  steps  to  avert  such 
a  calamity. 

"(2)  The  government  should  not  only,  as  the 
greatest  employer  of  labor,  set  a  good  example  in 
this  respect,  but  should  also  seek  to  influence  em- 
ployers by  proclaiming  in  advance  that  it  will  not 
attempt  to  lower  the  standard  rates  or  conditions 
in  public  employment,  by  announcing  that  it  will  in- 
sist on  the  most  rigorous  observance  of  the  fair 
wages  clause  in  public  contracts,  and  by  recommend- 
ing every  local  authority  to  adopt  the  same  policy. ' ' 

The  attitude  of  the  British  Labor  Party  was  radi- 
cal. Its  policy  not  only  aimed  to  consider  industrial 
labor  problems  in  advance  of  the  return  of  peace 
and  to  insist  on  the  maintenance  of  the  rates  of 
wages  prevailing  in  all  industries  in  1918,  but  its 
program  demanded  the  prevention  of  unemployment 
altogether.  This  was  a  stupendous  proposal.  It 
takes  no  cognizance  of  the  law  of  supply  and  demand 


10  The  Place  of  Agriculture  in  Reconstruction 

nor  of  the  financial  difficulties  in  the  way  of  its  exe- 
cution. It  is  taken  for  granted  that  a  demand  for 
labor  can  be  created  in  many  public  service  enter- 
prises which  will  absorb  a  vast  number  of  workers, 
and  those  not  employed  can  be  supported  at  public 
expense.  The  language  of  the  resolution  is  as 
follows : 

"The  conference  cannot  ignore  the  likelihood  that 
the  years  immediately  following  the  war  will  include 
periods  of  grave  dislocation  of  profit-making  indus- 
try, now  in  this  trade  or  locality  and  now  in  that, 
when  many  thousands  of  willing  workers  will,  if 
matters  are  left  to  private  capitalism,  probably  be 
walking  the  streets  in  search  of  employment ;  that  it 
is  accordingly  the  duty  of  the  ministry,  before  de- 
mobilization is  actually  begun,  so  to  arrange  the  next 
ten  years '  program  of  national  and  local  government 
works  and  services — including  housing,  schools, 
roads,  railways,  canals,  harbors,  afforestation, 
reclamation,  etc. — as  to  be  able  to  put  this  program 
in  hand,  at  such  a  rate  and  in  such  districts  as  any 
temporary  congestion  of  the  labor  market  may  re- 
quire; that  it  is  high  time  that  the  government 
laid  aside  the  pretense  that  it  has  no  responsibility 
for  preventing  unemployment;  that  now  that  it  is 
known  that  all  that  is  required  to  prevent  the  oc- 
currence of  any  widespread  or  lasting  unemploy- 
ment is  that  the  aggregate  total  demand  for  labor 
should  be  maintained,  year  in  and  year  out,  at  an 


Labor  Problems  on  the  Return  of  Peace      11 

approximately  even  level,  and  that  this  can  be  se- 
cured by  nothing  more  difficult  or  more  revolution- 
ary than  a  sensible  distribution  of  the  public  orders 
for  works  and  services  so  as  to  keep  always  up  to  the 
prescribed  total  the  aggregate  public  and  capitalist 
demand  for  labor,  together  with  the  prohibition  of 
overtime  in  excess  of  the  prescribed  normal  work- 
ing day,  there  is  no  excuse  for  any  government  which 
allows  such  a  grave  social  calamity  as  widespread  or 
lasting  unemployment  ever  to  occur. 

"To  meet  the  needs  of  individuals  temporarily 
out  of  work,  the  Labor  Party  holds  that  the  best 
provision  is  the  out-of-work  pay  of  a  strong  trade 
union,  duly  supplemented  by  the  government  sub- 
vention guaranteed  |by  Part  II  of  the  insurance 
act ;  .  .  .  that  this  subvention  ought  to  be  increased 
so  as  to  amount  to  at  least  half  the  weekly  allow- 
ance; and  that,  for  the  succor  of  those  for  whom 
trade  union  organization  is  not  available,  the  state 
unemployment  benefit  raised  to  an  adequate  sum 
should  be  made  universally  applicable  in  all  indus- 
tries and  occupations  where  objection  is  not  taken 
by  the  trade  union  concerned  to  the  compulsory  in- 
clusion of  its  members." 

Provision  for  Soldiers  and  Sailors 

These  resolutions  plainly  pertain  to  industrial 
workers  of  whom  there  are  many  millions  in  Great 
Britain.  They  are  all  to  be  provided  with  work  or 


12  The  Place  of  Agriculture  in  Reconstruction 

financial  aid  in  the  process  of  the  socialization  of 
industry  during  the  reconstruction  period.  This  is 
estimated  to  last  at  least  ten  years.  But  the  prob- 
lem is  intensified  by  the  return  of  millions  of  dis- 
charged soldiers  and  sailors.  Are  these  forgotten  in 
the  program  of  economic  and  social  reconstruction? 
By  no  means.  Many  of  the  soldiers  and  sailors  left 
their  trades  to  take  up  arms  and  will  seek  employ- 
ment again  in  those  trades  when  demobilized.  The 
British  Labor  Party  recognized  this  fact  and  passed 
the  following  resolution : 

"The  conference  realizes  that,  as  soon  as  peace  is 
assured,  the  position  of  the  soldier  or  sailor  will  be 
one  of  great  peril;  that,  whilst  his  services  to  the 
nation  will  be  effusively  praised,  and  promises  will 
be  made  for  a  generous  provision  for  his  needs,  there 
is  only  too  much  reason  to  fear  that,  unless  a  strong 
and  continuous  effort  is  made,  both  in  Parliament 
and  in  the  localities,  administrative  parsimony  and 
red-tape  will  deprive  many  thousands  of  what  is 
justly  due  to  them. 

"The  conference  accordingly  holds  that  it  is  im- 
perative that  the  provision  to  be  made  on  demobiliza- 
tion should  not  only  be  worked  out  in  detail  imme- 
diately, but  that  it  should  be  published  for  general 
information,  so  that  omissions  may  be  detected,  mis- 
takes rectified,  and  every  one  made  acquainted  with 
the  steps  to  be  taken. 

"The  conference,  noting  the  month's   furlough, 


Labor  Problems  on  the  Return  of  Peace    13 

gratuity,  free  railway  ticket,  and  a  year's  unemploy- 
ment benefit  if  out  of  work  already  promised  to  the 
soldier,  urges  that— 

"  (1)  There  should  be  no  gap  between  the  cessa- 
tion of  hik  pay  and  separation  allowance  and  the  be- 
ginning of  his  unemployment  benefit. 

"(2)  That  this  special  ex-soldier's  unemploy- 
ment benefit  given  to  all  should  be  additional  to  any 
unemployment  benefit  under  the  National  Insurance 
Act,  to  which  many  men  are  already  entitled  in  re- 
spect of  contributions  deducted  from  their  wages. 

"(3)  That  the  amount  of  the  unemployment 
benefit  should  not  be  the  present  starvation  pittance 
of  7s.  per  week,1  but  at  least  approaching  to  the  com- 
bined separation  and  rations  allowances. 

"  (4)  That,  in  view  of  the  change  in  the  value  of 
money,  the  gratuity  (which  should  be  made  payable 
through  the  Post  Office  Savings  Bank)  ought  to  be 
£202  for  the  private. 

"The  conference  feels,  however,  that  what  the 
soldiers  will  most  seriously  look  to  is  not  the  sum 
of  money  doled  out  to  them,  but  the  provision  made 
for  ensuring  them  situations  appropriate  to  their 
capacities  and  desires ;  it  declares  that  this  duty  of 
placing  the  demobilized  soldier  within  reach  of  a 
suitable  situation  at  the  trade  union  standard  rate  is 

'A  little  less  than  $2.00  a  week. 
'About  $100, 


14  The  Place  of  Agriculture  in  Reconstruction 

one  for  the  government  itself  to  discharge,  without 
the  intervention  of  charity  or  philanthropy. 

"And  the  conference  demands  that  the  govern- 
ment should  at  once  complete  and  make  known  the 
organization  projected  for  fulfilling  this  duty,  in- 
cluding appropriate  arrangements  for  enabling 
such  of  the  men  as  wish  it  to  obtain  small  holdings, 
for  others  to  get  such  training  for  new  occupations 
as  they  require,  and  for  all  to  secure  such  posts  in 
productive  work  or  service  as  they  are  capable  of 
filling,  or,  in  the  alternative,  to  be  maintained  until 
such  posts  can  be  found." 

Here,  then,  we  have  the  problems  of  industrial 
readjustment  after  the  war  plainly  set  forth  from  the 
viewpoint  of  the  British  laboring  classes.  It  con- 
templates a  shifting  of  the  burden  of  operating  the 
government  from  one  shoulder  to  the  other — from 
the  cost  of  war  to  the  cost  of  industry.  The  enormous 
indebtedness  which  the  British  people  through  its 
government  have  had  to  assume,  and  which  will  in- 
crease by  millions  of  pounds  every  week  the  war 
continues,  will  necessarily  increase  greatly  under 
such  a  program  as  above  outlined.1  It  overlooks 
entirely  the  most  difficult  of  all  financial  problems, 
namely,  how  to  redeem  colossal  indebtedness  with- 
out colossal  taxation.  In  fact,  the  program  of  the 
British  Labor  Party  would  irrevocably  commit  the 

1  Estimated  by  the  Mechanics  and  Metals  National  Bank  of  New 
York  at  $40,000,000,000  on  January  1,  1919. 


Labor  Problems  on  the  Return  of  Peace     15 

empire  to  a  continuing  and  growing  indebtedness 
without  an^  plan  of  redemption  whatsoever.  It 
could  only  possibly  terminate  in  one  way — the 
economic  ruin  of  the  country  and  its  financial  bank- 
ruptcy. Such  a  policy  resembles  very  closely  that 
which  brought  about  the  economic  and  political  col- 
lapse of  Eussia  with  all  its  attendant  anarchy  and 
bloodshed. 

Reconstruction  in  Devastated  Countries 

Labor  problems  in  France,  Belgium  and  Serbia 
after  the  war  will  be  altogether  different  from  what 
they  are  in  Great  Britain,  Italy,  Canada  and  the 
United  States.  The  latter  countries  have  not  been 
devastated ;  the  former  countries  have  been.  To  the 
readjustment  of  industrial  labor  forces  which  must 
inevitably  occur  in  devastated  countries  will  be 
added  the  problems  of  reconstruction  of  homes, 
farms,  factories,  commercial  enterprises  and  villages 
destroyed  during  the  German  occupation. 

To  a  certain  extent  reconstruction  in  France,  Bel- 
gium and  Serbia  will  relieve  the  congested  labor 
market  providing  a  satisfactory  credit  system  is 
devised  and  put  into  effect.  Thousands  of  discharged 
war  workers  and  soldiers  can  be  used  in  the  work 
of  reconstructing  damaged  and  destroyed  roads, 
bridges,  private  properties  and  villages.  As  a  mat- 
ter of  fact,  problems  of  reconstruction  in  those 
countries  are  attracting  more  attention  than  indus- 


16  The  Place  of  Agriculture  in  Reconstruction 

trial  labor  problems.  Many  books  have  already  been 
issued  dealing  with  different  aspects  of  reconstruc- 
tion. The  heart  of  the  problem  is  recognized  as  the 
need  of  money  or  credit  for  providing  necessary 
materials.  The  land  will  be  there  and  labor  will  be 
in  abundance,  but  capital  will  be  scarce  or  altogether 
lacking.  The  problems  of  reconstruction  are  so 
enormous  that  they  are  beyond  the  means  of  private 
or  corporate  capital.  The  only  alternative  is  the 
nation  itself  as  embodied  in  its  government.  For 
many  years  after  the  war  is  over,  the  governments* 
of  the  devastated  countries  will  need  to  borrow 
money  or  tax  their  people  to  provide  funds  for  re- 
construction. If  the  burden  becomes  too  great  for 
the  people  of  the  devastated  countries  to  bear  alone, 
other  more  favored  nations  must  come  to  their  as- 
sistance not  only  to  protect  the  credit  already  sup- 
plied during  the  war,  but  to  enable  the  occupants 
of  those  regions  to  become  producers  of  wealth  and 
thereby  sooner  or  later  place  themselves  in  a  posi- 
tion to  repay  all  their  indebtedness.  This  is  the 
great  problem  in  those  countries  where  the  German 
invasion  has  been  longest  endured  and  most  destruc- 
tive. 

Several  recent  French  books  dealing  with  indus- 
trial and  reconstruction  problems  maintain  the 
thesis  that  the  work  of  readjustment  after  the  war 
will  require  as  much  preparation  and  detailed  care 
as  are  given  to  military,  productive  and  adminis- 


Labor  Problems  on  the  Return  of  Peace     17 

trative  adjustments  during  the  war.  Owing,  how- 
ever, to  the  enormous  amount  of  property  which  has 
been  wrecked  or  destroyed,  France  has  been  able  to 
conceive  only  the  barest  outlines  of  the  stupendous 
task  of  reconstruction  that  awaits  her. 

Among  these  writers  stands  out  prominently 
Andre  Lebon,  formerly  minister  of  commerce,  and, 
at  the  time  of  writing,  president  of  the  Federation 
of  Manufacturers  and  Merchants.  His  viewpoint 
is  the  opposite  of  organized  labor;  its  program  he 
brands  as  the  fruitage  of  "the  pernicious  influence 
of  socialism. "  Lebon  mourns  over  the  fact  that 
there  was  complete  absence  of  any  financial  prepara- 
tion for  peace  up  to  the  end  of  1917 ;  but  he  recog- 
nizes the  great  problems  of  French  industrial  rela- 
tions after  the  war  and  portrays  them  as  follows  : 

"  There  is  no  doubt  that  our  soldiers  of  to-day, 
our  workers  of  yesterday  and  of  to-morrow,  will  re- 
turn with  an  immense  need  for  rest  and  relaxation. 
Yet,  driven  by  the  force  of  circumstances,  it  will  be 
necessary  to  ask  them  for  an  increase  in  exertion. 
They  will  come  back  with  the  desire  to  live  well,  and, 
for  several  years  after  the  war,  will  find  a  more 
difficult  and  strenuous  life  than  they  experienced  at 
the  front.  They  will  return  with  the  desire  to  share 
wages  as  high  at  least  as  those  they  now  know  are 
earned  in  war  munition  plants  by  their  wives,  their 
sisters,  their  daughters,  and  even  by  minors. 

"This  demand,  even  though  it  may  not  be  justified 


18  The  Place  of  Agriculture  in  Reconstruction 

by  the  economic  situation  at  that  time,  will  seem 
right  to  them  because  of  the  high  cost  of  living  which 
is  likely  to  survive  for  several  years  after  the  war. 
But  these  men  will  find  themselves  in  conflict  with 
employers  who,  having  been  deprived  of  their  nor- 
mal markets  during  the  war,  will  have  difficulty  in 
adjusting  their  equipment  to  the  demands  of  peace 
and  to  secure  raw  materials  sufficient  in  volume  to 
assure  a  full-time  operation  of  their  plants. 

"  These  employers  will  quite  naturally  seek  to  re- 
duce the  cost  of  production.  They  will  not  always 
remember  that  the  greatest  economies  in  manufac- 
ture are  derived  from  the  installation  of  modern  ma- 
chinery and  from  a  division  of  labor  and  its  organ- 
ization, which  result  in  an  almost  incredible  output 
of  goods  without  a  corresponding  additional  amount 
of  exertion  on  the  part  of  the  workers.  Such  em- 
ployers will  tend  to  resist  wages/' 

To  these  tendencies  will  be  added  the  employment 
of  women  which  will  complicate  the  industrial  prob- 
lems after  the  war.  While  engaged  in  war  indus- 
tries they  have  acquired  economic  independence. 
Their  industrial,  executive,  and  initiative  capacities 
have  only  recently  been  discovered  by  industrial 
managers  and  operators.  Neither  the  manufacturers 
nor  the  women  employees  will  give  up  present  ar- 
rangements in  order  to  reinstate  the  old  industrial 
order. 

And  what  thoughtful  men  foresee  as  to  the  future 


Labor  Problems  on  the  Return  of  Peace    19 

industrial  problems  in  France  are  true  in  greater 
degree  as  to  Belgium  and  Serbia.  In  those  coun- 
tries the  problems  are  not  so  much  concerned  with 
industry  and  reconstruction  as  with  actual  re- 
habilitation. Nor  can  these  countries  renew  them- 
selves without  aid  from  more-favored  nations.  For 
the  preservation  of  human  rights  and  liberty,  Bel- 
gium and  Serbia  went  through  the  long  and  dark 
valley  of  desolation  and  death.  They  sacrificed  all. 
To  what  extent  their  heroic  struggle  and  sacrifice 
saved  the  world  from  the  rod  and  yoke  of  the  op- 
pressor will  never  be  known.  But  liberty-loving 
nations  owe  them  a  debt  of  gratitude  for  their  sor- 
rows and  sufferings — a  debt  that  can  only  be  partly 
paid  by  financial  and  other  aid  which  will  enable 
their  people  to  restore  themselves  to  a  position  of 
honor,  independence  and  prosperity  such  as  they 
enjoyed  among  civilized  nations  before  the  war. 

In  the  work  of  preparing  for  the  labor  problems  of 
peace,  France  has  reeducated  many  disabled  sol- 
diers. Special  arm  appliances  have  been  invented 
for  useful  purposes  in  industrial  work.  In  fact, 
France  was  the  first  of  the  allies  to  make  adequate 
provision  for  the  vocational  training  of  war  cripples. 

The  work  began  in  Lyons  in  December,  1914. 
Three  days  after  the  organization  of  this  school  the 
first  pupil  was  admitted.  From  this  small  begin- 
ning, there  has  grown  up  an  organized  system  which, 


20  The  Place  of  Agriculture  in  Reconstruction 

in  1918,  comprised  more  than  one  hundred  voca- 
tional institutions  for  training  disabled  soldiers. 

Canada's  Labor  Problems 

For  several  years  the  Dominion  of  Canada  has 
been  face  to  face  with  the  problem  of  readjusting 
her  labor  forces.  Early  in  1915  it  was  recognized 
that  it  was  absolutely  necessary  to  conserve  all  the 
man-power  possible,  not  only  to  supply  the  Do- 
minion's needs  during  the  war,  but  also  for  the  con- 
tinuance of  agriculture,  industry  and  commerce  after 
the  war. 

The  year  1915  opened  with  a  large  number  of  re- 
turned soldiers  who  were  permanently  injured.  As 
the  men  continued  to  come  back  in  increasing  num- 
bers, it  was  found  that  many  soldiers  were  so  dis- 
abled that  they  would  be  unable  to  follow  their 
previous  occupations.  The  Dominion  government, 
therefore,  was  compelled  to  provide  adequate  means 
and  facilities  for  the  training  of  disabled  men  for 
future  industrial  activities. 

Canada's  program  of  readjustment  of  her  labor 
forces  has  been  one  of  evolution.  In  the  matter  of 
retraining,  the  order-in-council  which  placed  this 
work  under  direct  government  control  is  very  spe- 
cific and  reads  as  follows : 

"Any  member  of  the  Canadian  expeditionary 
force  who  has  been  so  disabled  in  the  line  of  duty 
that  he  can  no  longer  pursue  his  former  occupation 


Labor  Problems  on  the  Return  of  Peace    21 

is  entitled  to  a  retraining  course  which  will  fit  him 
for  earning  a  living  at  some  kind  of  work  at  which 
his  disability  will  not  disqualify  him." 

The  reeducation  courses  which  have  been  ap- 
proved and  organized  for  returned  soldiers  number 
approximately  two  hundred.  They  include  both  in- 
dustrial and  agricultural  lines  of  work.  On  account 
of  the  vast  extent  of  territory,  adapted  and  devoted 
to  agriculture  and  stock  raising  in  Canada,  as  com- 
pared with  her  limited  number  of  industrial  centers, 
the  problem  has  mainly  consisted  in  providing  re- 
education courses  in  mixed  farming,  stock  raising, 
market  gardening  and  farm  mechanics. 

But  even  in  the  matter  of  industrial  reeducation 
it  was  early  found  that  the  training  afforded  by  the 
ordinary  technical  schools  of  Canada  was  too 
limited  in  scope.  The  lines  of  work  open  to  disabled 
soldiers  were  too  few  in  number  to  meet  their  needs. 
Moreover,  to  have  continued  the  training  of  large 
numbers  of  men  in  a  limited  number  of  occupations 
would  have  resulted  in  so  over-crowding  the  labor 
market  in  a  few  trades  and  industries  that  the  sol- 
diers would  soon  have  come  in  competition  with 
themselves.  Industrial  surveys,  therefore,  were 
undertaken  by  the  government  with  a  view  of  en- 
abling the  returned  soldier  to  receive  a  training  of 
an  educational  nature,  which  would  not  only  meet 
his  needs  and  inclinations,  but  would  prepare  him 
to  take  his  place  in  the  general  industrial  life  of  the 


22  The  Place  of  Agriculture  in  Reconstruction 

Dominion.  Even  while  a  disabled  soldier  is  under 
the  control  of  the  Army  Medical  Corps,  he  is  care- 
fully studied  prior  to  his  discharge  with  a  view  of 
ascertaining  his  qualifications  for  any  particular  line 
of  work.  In  some  cases  the  preliminary  work  of  a 
disabled  soldier's  reeducation  is  begun  before  he 
leaves  the  hospital. 

After  three  years'  experience  in  the  vocational 
training  of  disabled  soldiers  for  industrial  life,  the 
Canadian  government  came  to  the  conclusion  that  a 
new  department,  separate  and  distinct  from  all  mili- 
tary control,  was  absolutely  essential  for  fitting 
veterans  for  a  renewal  of  their  civil  life.  This  con- 
viction resulted  in  the  creation,  in  March,  1918,  of 
the  Soldiers'  Civil  Eeestablishment  Department 
with  a  representative  in  the  cabinet.  The  new  de- 
partment was  given  control  of  all  matters  pertaining 
to  the  care,  employment  and  education  of  returned 
soldiers,  the  work  of  vocational  training  being 
placed  under  the  control  of  the  Invalided  Soldiers' 
Commission.  This  is  a  civilian  organization  which 
takes  up  the  work  of  a  soldier's  industrial  reeduca- 
tion after  his  discharge  from  the  army. 

The  Invalided  Soldiers'  Commission  was  an  out- 
growth of  an  inter-provincial  conference  held  at 
Ottawa  in  October,  1915.  The  object  of  that  confer- 
ence was  to  formulate  a  plan  to  find  employment  in 
various  trades  for  discharged  soldiers  who  were 


Labor  Problems  on  the  Return  of  Peace    23 

physically  fit  to  take  such  employment.  From  time 
to  time  similar  conferences  were  held  in  which  the 
provinces  pledged  themselves  to  assume  responsi- 
bility for  the  employment  of  returned  soldiers. 

The  program  thus  outlined  is  preparatory  to  the 
labor  problem  which  is  foreseen  when  demobiliza- 
tion actually  occurs.  Each  province  is  to  form  its 
own  industrial  or  employment  center  which  will  act 
in  cooperation  with  the  central  government  Soldiers' 
Civil  Eeestablishment  Department.  The  object  is 
to  group  the  trades  by  various  industries  and  classi- 
fy all  occupations  in  such  groups.  These  classifica- 
tions, with  their  figures,  will  be  made  available  to 
the  military  officials.  On  the  return  of  peace  a  cen- 
sus of  all  men  in  the  army  will  be  taken,  information 
being  procured  as  to  each  one's  occupation,  the  in- 
dustrial group  to  which  he  belongs,  and  the  locality 
to  which  he  wishes  to  return. 

By  having  this  plan  coordinated  by  the  central 
government,  uniformity  in  methods  and  procedure 
will  be  secured  throughout  Canada.  The  govern- 
ment, through  a  labor  or  statistical  bureau,  will  be 
able  to  look  after  the  requirements  of  the  labor  mar- 
ket in  such  a  way  that  the  labor  supply  will  be 
adjusted  to  the  labor  demand  in  different  parts  of 
the  country. 

Soldiers,  war  workers,  and  others  are  classified 
into  three  groups:  (1)  Those  who  will  return  to 


24  The  Place  of  Agriculture  in  Reconstruction 

their  previous  occupations ;  (2)  those  who  must  have 
employment  in  a  particular  locality  because  of  home, 
business,  financial,  or  other  obligations;  and  (3) 
those  who  will  go  anywhere  to  find  work.  An  active 
propaganda  campaign  has  long  been  conducted  at 
the  Canadian  Discharge  Depot  at  Buxton,  England, 
with  a  view  of  impressing  upon  the  men  not  only 
their  future  responsibilities,  but  also  the  absolute 
necessity,  if  disabled,  of  their  learning  a  new  trade 
and,  if  not  disabled,  of  returning  to  active  civil  life 
as  soon  as  possible.  At  the  same  time  effort  is  being 
made  to  bring  about  a  sympathetic  relationship  be- 
tween industrial  employers  and  trade  groups  and 
organizations  so  that  there  will  be  no  industrial 
strife  over  wages  now  that  the  military  struggle  has 
been  brought  to  an  end,  and  when  all  Canadian  sol- 
diers have  been  returned. 

Problems  Confronting  the  United  States 

With  the  prospect  of  our  country  having  about  two 
million  soldiers  to  demobilize  when  peace  is  declared 
and  other  war  workers  thrown  on  the  labor  market 
who  will  be  forced  to  seek  other  lines  of  employment, 
the  need  of  a  definite  program  for  handling  our  labor 
forces  is  well  recognized.  The  care  and  reeducation 
of  disabled  soldiers,  the  number  of  whom  constantly 
increased  with  the  prolongation  of  the  war,  has 
brought  home  to  our  own  people  some  conception 
of  the  stupendous  problems  which  confront  us  as  a 


Labor  Problems  on  the  Return  of  Peace    25 

nation.1  The  first  task  is  that  of  caring  for  those 
disabled  industrial  and  economic  units  whose  sacri- 
fice in  loss  of  limb  in  behalf  of  human  rights  and  jus- 
tice can  never  be  wholly  repaid  by  any  service  of 
reeducation  which  the  government  undertakes  for 
them. 

A  program  for  retraining  disabled  soldiers  to  fit 
them  to  take  their  place  again  in  our  economic  life 
is  well  under  way.  On  January  14,  1918,  a  confer- 
ence was  held  in  Washington,  D.  C.,  to  discuss  the 
matter  and  a  bill  was  introduced  into  Congress 
which  called  for  the  creation  of  an  inter-depart- 
mental commission  to  be  known  as  the  Board  of 
Vocational  Kehabilitation.  This  bill  appropriated 
$10,000,000  for  the  work,  but  required  that  disabled 
soldiers  should  attend  certain  vocational  training 
schools,  thus  permitting  little  or  -no  choice  to  the 
soldier  to  determine  for  himself  his  future  trade  or 
calling.  His  means  of  earning  a  living  was  to  be 
prescribed  for  him,  and  proper  courses  for  his 
training  were  provided  with  compensation  while 
learning  his  new  trade. 

This  first  bill  did  not  prove  satisfactory.  Conse- 
quently, on  April  8,  1918,  a  revised  bill  was  intro- 
duced in  the  Senate  by  Hon.  Hoke  Smith  of  Georgia, 
was  soon  passed  by  Congress,  and  was  signed  by  the 
President  on  June  27,  1918.  This  act  provides  that 

JOn  March  1,  1919,  no  less  than  18,878  men  interested  in  re- 
training had  signed  blanks  sent  out  by  the  Federal  Board  for 
Vocational  Education. 


26  The  Place  of  Agriculture  in  Reconstruction 

the  reeducation  of  disabled  soldiers  shall  not  be 
compulsory,  but  a  matter  of  choice  on  the  individ- 
ual's part,  so  that  he  will  work  with  greater  interest 
to  fit  himself  for  some  line  of  industrial  service. 
When  his  training  under  the  Federal  Board  for  Vo- 
cational Education  is  completed,  it  is  the  proposed 
policy  of  the  government  to  find  him  a  position  at 
his  new  trade  or  calling.  Where  disabled  soldiers  or 
sailors  have  no  trade,  they  are  to  be  given  the  first 
chance  to  fill  civil  service  positions  in  all  the  na- 
tions allied  with  the  United  States. 

While  our  own  country  has  not  been  invaded  so  as 
to  require  the  reconstruction  of  villages  and  towns 
as  in  Belgium,  France  and  Serbia,  Congress  soon 
foresaw  the  many  problems  connected  with  the  re- 
turn of  peace.  On  October  2,  1918,  a  concurrent 
resolution  was  passed  which  provided  for  the  estab- 
lishment of  a  Joint  Congressional  Committee  on  Be- 
construction  composed  of  six  senators  and  six  rep- 
resentatives. That  the  problems  involved  would 
take  a  long  time  to  solve  is  shown  by  the  fact  that 
the  resolution  provided  that  no  senator  or  congress- 
man should  be  eligible  for  membership  on  the  com- 
mittee, who  had  not  been  elected  to  serve  in  the 
Sixty-sixth  Congress,  and  that  such  membership 
should  terminate  with  the  service  in  Congress  of 
any  member  so  appointed.  Since  the  Sixty-sixth 
Congress  will  not  terminate  until  March,  1921,  it  was 
evidently  anticipated  that  such  a  committee  would 


Labor  Problems  on  the  Return  of  Peace    27 

have  an  active  existence  of  not  less  than  two  years 
within  which  to  prepare  a  reconstructive  program 
involving  the  adjustment  of  labor  to  agriculture,  in- 
dustry, trade  and  commerce  when  peace  should  be 
restored. 

As  regards  our  demobilized  soldiers  and  sailors, 
the  congressional  resolution  makes  two  provisions 
only.  The  committee  is  authorized  (1)  to  investi- 
gate problems  affecting  labor  with  a  view  of  utilizing 
discharged  soldiers  and  sailors  in  civil  employments ; 
and  (2)  to  consider  the  problems  relating  to  agri- 
culture which  should  include  "the  allotment  of  lands 
to  returned  soldiers  and  sailors  and  their  establish- 
ment in  new  homes  on  the  public  domain. ' '  The  con- 
templated program  of  the  joint  committee,  how- 
ever, is  a  most  extensive  one  and  covers  practically 
every  phase  of  our  economic  and  social  life.  This 
is  shown  by  the  following  brief  summary  of  the  prob- 
lems to  be  investigated  and  reported  to  Congress 
from  time  to  time,  with  such  recommendations  as  to 
any  future  legislation  the  committee  may  deem  ad- 
visable in  addition  to  those  above  mentioned  relating 
particularly  to  soldiers  and  sailors.  The  subjects 
to  be  considered  include : 

1.  Problems  affecting  labor,  such  as  unemploy- 
ment which  may  follow  the  war;  conciliation  and 
arbitration  of  labor  disputes;  relation  of  men  and 
women  in  similar  employments;  substitution  of  fe- 
male employees  for  male  and  vice  versa ;  feasibility 


28  The  Place  of  Agriculture  in  Reconstruction 

of  organizing  permanent  employment  agencies;  re- 
quirements for  labor  after  the  war,  both  in  agricul- 
tural and  industrial  occupations;  distribution  of 
labor;  and  employment  of  surplus  labor  on  public 
works  of  which  the  construction  or  completion  has 
been  suspended  due  to  the  war. 

2.  Problems  affecting  capital  and  credit,  such  as 
matters  relating  to  trusts  and  combinations ;  federal 
loans  to  private  enterprises ;  and  federal  supervision 
of  capital  issues. 

3.  Problems  affecting  public  utilities,  such  as  the 
establishment  of  a  railroad  policy  after  the  war,  and 
the  relation  of  the  Interstate  Commerce  Commission 
to  the  railroads;  and  all  questions  relating  to  com- 
munication by  wire. 

4.  Problems   resulting  from  the  demobilization 
of  our  industrial  and  military  war  resources,  such  as 
the  disposal  of  surplus  government  properties  and 
supplies  in  this  country  and  abroad;  the  conversion 
of  munition  industries  into  those  of  peace;  the  de- 
mobilization of  the  war  strength  of  the  army  and 
navy,  and  the  disposition  of  the  men  who  have  been 
in  the  service ;  and  the  demobilization  of  civilian  war 
workers. 

5.  Problems  affecting  our  foreign  trade,  such  as 
the  development  of  new  markets;  combinations  for 
the  purpose  of  increasing  our  selling  facilities ;  and 
changes  in  our  banking  facilities  necessary  to  co- 
operate with  such  trade. 


Labor  Problems  on  the  Return  of  Peace    29 

6.  Problems  affecting  the  continuance  of  existing 
industries  and  the  establishment  of  new  industries, 
such  as  the  supply  and  control  of  raw  materials ;  the 
encouragement   of   the   production   in   the   United 
States  of  articles  that  have  not  been  made  in  this 
country  heretofore;  the  encouragement  of  private 
enterprise  in  the  development  of  the  resources  of  the 
public  domain ;  and  the  utilization  of  a  tariff  on  im- 
ports as  a  means  to  protect  and  encourage  home  in- 
dustries. 

7.  Problems  relating  to  agriculture,  such  as  the 
advisability    of    continuing    price    fixing    of    food 
products  after  the  war;  federal  loans  to  farmers; 
and  distribution  of  food  products. 

8.  Problems  affecting  the  adequate  production 
and  effective  distribution  of  coal,  gasoline,  and  other 
fuels;  shipping,  including  shipyards  and  the  sale, 
ownership  or  leasing  of  both  yards  and  ships ;  hous- 
ing conditions  and  disposition  of  houses  constructed 
by  the  government  during  the  war ;  the  repeal,  exten- 
sion, or  amendment  of  war  legislation  now  on  the 
statute  books;  and,  lastly,  all  matters  necessarily 
arising  during  the  change  from  the  activities  of 
war  to  the  pursuits  of  peace. 

The  Outlook  on  Social  Life 

The  preceding  review  of  the  problems  which  con- 
front many  nations  after  the  war  gives  us  a  vantage 
ground  from  which  to  look  into  the  future.  The 


30  The  Place  of  Agriculture  in  Reconstruction 

first  thing  apparent  is  that  our  economic  and  social 
life  will  be  undergoing  radical  changes  for  many 
years  to  come.  No  program  which  has  been  pro- 
posed by  any  nation  anticipates  that  national  life 
will  approach  a  normal  condition  until  the  lapse  of 
at  least  ten  years.  The  problems  are  stupendous 
both  as  to  time  involved  and  their  successful  execu- 
tion. They  include  the  rehabilitation  of  some  coun- 
tries, the  reconstruction  of  community  life,  the  pro- 
duction of  food  and  raw  materials  of  manufactures, 
the  transportation  of  supplies,  the  readjustment  of 
labor  forces,  satisfactory  provision  for  discharged 
soldiers  and  sailors,  and  the  continuance  of  taxa- 
tion, indebtedness,  and  credit. 

Another  noticeable  feature  is  the  large  part  which 
the  labor  problem  occupies  in  the  outlook  on  our 
coming  social  life.  The  demobilization  of  millions 
of  men  from  the  army  and  navy,  the  great  majority 
of  whom  will  enter  into  competition  with  millions 
of  others  discharged  from  war  and  related  indus- 
tries, will  create  a  condition  in  the  labor  market 
hitherto  unprecedented  in  the  history  of  our  coun- 
try. And  the  question  which  looms  large,  in  view 
of  future  labor  conditions,  is,  How  can  our  soldiers 
and  sailors  be  quickly  absorbed  as  active  productive 
units  in  the  economic  and  social  life  of  the  nation! 

In  seeking  to  answer  this  question  thoughtful 
minds  naturally  turn  to  the  land  as  a  means  of  utiliz- 
ing a  vast  army  of  men.  It  is  recognized  that  agri- 


Labor  Problems  on  the  Return  of  Peace    31 

culture  and  land  settlement  can  play — yea,  rather, 
must  play — an  important  part  in  the  readjustment 
of  productive  labor  forces  now  that  this  great  war 
has  terminated.  It  is  equally  certain  that  a  pro- 
gram should  be  prepared ;  that  a  definite  course  of 
action  should  be  mapped  out ;  and  that  there  should 
be  no  delay  in  settling  soldiers  and  sailors  on  the 
land  after  demobilization.  This  in  itself  is  a  stu- 
pendous problem.  It  has  its  difficulties ;  but  it  also 
has  its  promises  for  the  welfare  and  happiness  of 
our  future  farmers.  Let  us  proceed,  therefore,  to 
point  out  to  what  extent  agriculture  has  been  advo- 
cated as  a  partial  solution  of  the  future  labor  prob- 
lem and  what  it  actually  offers  as  a  means  of  ab- 
sorbing a  large  number  of  demobilized  soldiers  and 
sailors.  At  the  same  time  let  us  endeavor  to  see 
what  is  the  exact  nature  of  the  problem  which  con- 
fronts nations  on  the  return  of  peace,  and  what  are 
the  conditions  which  make  for  the  success  or  failure 
of  any  land  settlement  or  colonization  scheme  for 
ex-service  men. 


CHAPTER  II.— THE  ROMAN  LAND  SETTLE- 
MENT SYSTEM  FOR  SOLDIERS  AND  ITS 
LESSONS 

In  a  letter  to  President  Wilson  dated  May  31, 1918, 
the  Secretary  of  the  Interior  said  the  time  had  come 
to  prepare  plans  for  providing  opportunity  for  our 
soldiers  returning  from  the  war,  stating  the  prob- 
lem in  the  following  language : 

1 1  Every  country  has  found  itself  face  to  face  with 
this  situation  at  the  close  of  a  great  war.  From 
Rome  under  Caesar  to  France  under  Napoleon,  down 
even  to  our  own  Civil  War,  the  problem  arose  as  to 
what  could  be  done  with  the  soldiers  to  be  mustered 
out  of  military  service." 

Since  this  is  a  problem  confronting  many  nations 
at  the  present  time,  and  which  will  have  to  be  con- 
sidered for  several  years  to  come  with  a  view  of 
its  satisfactory  solution,  one  of  the  first  steps  would 
seem  to  be  to  study  the  past  in  order  to  prepare  for 
the  future.  Cultivation  of  the  soil  has  always  been 
adopted  as  a  means  of  absorbing  large  numbers  of 
discharged  military  men.  This  is  being  advocated 
for  our  soldiers  and  sailors  now  that  the  European 
war  is  over.  With  this  object  in  view,  what  lesson 

32 


The  Roman  Land  Settlement  System      33 

does  a  nation  like  Eome  teach  us  about  land  settle- 
ment by  soldiers?  Can  we  learn  anything  from 
Borne 's  experience  which  will  be  of  service  to  the 
allied  nations  in  establishing  a  land  settlement 
scheme  for  ex-service  men?  These  are  the  questions 
we  shall  try  to  answer  in  the  present  chapter,  with 
a  view  of  ascertaining  whether  or  not  the  problem 
stated  by  the  Secretary  of  the  Interior  is  simple  or 
complex  in  character. 

Farmers  as  Roman  Soldiers 

In  the  early  days  of  the  Eoman  commonwealth 
only  citizens  were  admitted  into  the  army.  The 
tribunes  were  the  officers  who  had  choice  of  the  sol- 
diery from  all  citizens  between  seventeen  and  forty- 
five  years  of  age. 

But  not  every  citizen  was  deemed  worthy  of  being 
chosen  a  soldier.  In  those  days,  even  as  at  present, 
city  life  seemed  to  sap  the  vitality  of  many  young 
men  so  that  they  were  unable  to  stand  the  hard- 
ships of  military  life  and  were  excluded  from  the 
army.  By  the  institution  of  the  census  under  Ser- 
vius  Tullius,  the  whole  Eoman  people  were  divided 
into  distinct  classes  founded  on  the  value  of  their 
estates.  The  sixth  or  lowest  class  was  called  the 
proletarius,  from  which  term  our  word  proletariat 
is  derived,  which  is  so  commonly  used  in  current 
socialistic  literature.  A  citizen  of  this  class  pos- 
sessed little  or  no  property  and  he  was  not  allowed 


84  The  Place  of  Agriculture  in  Reconstruction 

to  serve  in  the  army.  His  usefulness  to  the  state 
consisted  only  in  supplying  the  commonwealth  with 
children. 

The  Eomans  were  for  having  soldiers  whose  real 
interest  in  the  prosperity  and  preservation  of  the 
state  would  prompt  them  to  act  with  zeal  in  its  de- 
fense. For  this  reason  their  best  soldiers  were 
farmers.  All  of  them  were  landowners,  having 
their  own  farms  on  which  they  lived  in  times  of 
peace  and  which  they  cultivated  themselves  with  the 
aid  of  members  of  their  family.  Thus,  when  called 
into  the  service  of  their  country  as  soldiers,  they 
were  accustomed  not  only  to  the  hard  labor  of  cul- 
tivating the  soil,  but  to  endure  sunshine  and  rain, 
heat  and  cold,  to  handle  heavy  instruments,  to  dig 
drainage  ditches,  and  to  carry  heavy  burdens.  As  a 
matter  of  fact,  when  these  farmers  entered  the  ser- 
vice as  soldiers  they  simply  changed  their  arms  and 
tools,  came  with  strong  bodies  accustomed  to  labor, 
and  were  used  to  the  fatigues  of  the  field. 

At  the  time  of  the  commonwealth  war  had  become 
the  active  profession  of  the  Eoman  people.  As  soon 
as  the  youth  reached  the  age  for  bearing  arms,  which 
was  seventeen  years,  they  were  all  obliged  to  pre- 
pare themselves  for  active  service,  military  training 
being  made  a  part  of  their  education.  In  Eome  it- 
self there  was  set  aside  a  space  of  ground  called  the 
Campus  Martins,  in  which  the  new  recruits  were 
trained  for  all  the  branches  of  the  service.  After 


The  Roman  Land  Settlement  System      35 

their  drills  they  plunged  into  the  Eiver  Tiber  to 
accustom  themselves  to  swimming  and  to  refresh 
themselves.  In  these  ways  they  were  constantly 
prepared  for  active  military  service  and  the  Eoman 
commonwealth  was  never  obliged,  on  any  sudden 
emergency,  to  commit  its  honor  and  safety  to  a  raw 
undisciplined  army.  The  state  had  always  a  suffi- 
cient number  of  men  in  readiness,  trained  and 
habituated  to  the  hardships  of  war,  for  recruiting 
its  armies.  But  of  all  its  recruits,  the  farmers  from 
the  outlying  districts  made  the  best  Eoman  soldiers. 

Allotments  of  Land  to  Soldiers 

One  of  the  inducements  to  service  in  the  military 
forces  of  the  commonwealth  was  the  free  distribu- 
tion of  land  made  at  the  close  of  a  successful  war. 
The  founders  of  Eome  had  taken  care  to  make  an 
equal  distribution  of  land.  At  that  time  the  Eomans 
were  an  agricultural  people.  Each  head  of  a  family 
cultivated  his  own  piece  of  land  and  lived  thereon. 
But  as  the  city  of  Eome  grew  in  population  and  war 
became  its  dominant  purpose,  allotments  of  land 
were  made  to  individuals  upon  the  condition  of  their 
serving  the  state  in  her  wars.  By  this  means  it  be- 
came the  interest  of  every  citizen  of  the  common- 
wealth to  exert  himself  to  the  utmost  in  the  defense 
of  the  soil  of  which  he  was  part  owner.  These  allot- 
ments of  land  were  made  so  long  as  it  was  available 
for  distribution. 


36  The  Place  of  Agriculture  in  Reconstruction 

With  the  growth  in  population,  however,  the  time 
came  when  there  was  no  longer  any  state  land  for 
distribution  without  seizing  the  land  of  neighboring 
cities.  In  those  days  states  were  simply  cities  with 
outlying  rural  districts  cultivated  primarily  to  fur- 
nish their  food  supplies  and  other  domestic  goods. 
The  growth  of  Eome,  then,  began  with  the  exploita- 
tion of  her  own  lands  to  maintain  a  military  sys- 
tem, and  the  growth  continued  by  seizing  and  ex- 
ploiting the  lands  which  belonged  to  other  states 
with  which  she  came  into  conflict. 

When  Eome  conquered  another  city  she  confis- 
cated a  portion  of  her  victim's  territory.  This  land 
was  disposed  of  in  four  ways : 

(1)  After  expelling  the  owners,  Eome  sent  some 
of  her  own  citizens  to  establish  colonies.    But  since 
these  colonists  were  either  soldiers  or  the  poorest 
class  of  citizens,  they  were  invariably  poorly  sup- 
plied with  the  capital  necessary  for  the  proper  and 
successful  cultivation  of  the  soil. 

(2)  The  government  sold  part  of  the  land.    In 
this  case  plans  were  made  of  the  dimensions  and 
boundaries  of  the  land  sold,  the  records  being  made 
on  tablets  of  bronze,  which  were  kept  by  the  state. 

(3)  Private  citizens  were  allowed  to  occupy  part 
of  the  land  on  the  payment  of  "vectigal,"  a  share 
of  the  produce.    In  this  case  though  the  government 
did  not  surrender  the  title  to  the  land,  the  state  per- 


The  Roman  Land  Settlement  System      37 

mitted  the  possessors  to  use  it  as  their  private  prop- 
erty for  purchase,  sale  and  succession. 

(4)  A  part  of  the  land  was  kept  as  common  pas- 
ture land  for  those  to  whom  it  had  been  given  or  sold, 
or  by  whom  it  was  occupied,  and  those  who  used  it 
paid  ' '  scriptura, ' '  a  tax  of  so  much  per  head  on  the 
cattle  for  the  grazing  of  which  they  made  returns  to 
the  state. 

This  irregular  system  was  fruitful  in  evil  which 
resulted  in  constant  agitation  for  land  reform.  It 
suited  the  rich  landowners,  with  whom  this  plan 
originated,  for  they  alone  reaped  the  benefits  of  it. 
For  the  poor  soldier  or  citizen  without  money,  it 
was  hopeless  to  occupy  land  distant  from  Borne. 
The  settler  who  did  so  would  either  involve  himself 
in  debt  or  the  flocks  of  his  richer  neighbors  would 
overrun  his  fields  and  destroy  his  crops.  If  he  com- 
plained, they  might  run  him  off  altogether  by  force 
or  even  seize  him  and  enroll  him  as  a  slave. 

Under  the  commonwealth,  in  proportion  as  the 
public  domain  increased  by  means  of  war,  it  was  the 
constant  practise  of  the  Roman  senate  to  allot  part 
of  the  conquered  lands  for  the  use  of  returning  sol- 
diers and  the  poorer  citizens  by  dividing  it  equally 
among  them.  But  neither  soldiers  nor  citizens  had 
the  capital  necessary  for  the  proper  cultivation  of 
the  soil  in  order  to  become  prosperous  farmers.  The 
state  did  not  undertake  to  provide  her  soldiers  with 
financial  aid  after  they  had  been  settled  on  the  land 


88   The  Place  of  Agriculture  in  Reconstruction 

nor  to  protect  them  against  usurious  money  lenders. 
When  they  had  been  granted  land,  the  soldiers  were 
left  to  their  own  resources  with  the  result  that  few 
of  them  were  ever  able  to  live  thereon  as  independent 
landowning  farmers. 

Roman  Soldiers  as  Farmers 

But  the  difficulties  were  intensified  because  of 
taxation.  The  business  of  a  state  cannot  be  con- 
ducted without  the  people  having  to  foot  the  bills. 
In  the  case  of  Home,  the  land  thus  allotted  to  her 
returned  soldiers  was  subject  to  a  tax  which  had  to 
be  paid  in  money.  Being  thus  doubly  oppressed  by 
a  lack  of  capital  and  a  land  tax,  the  small  landowning 
soldier  farmer  was  invariably  forced  to  borrow 
money  at  a  high  rate  of  interest.  Hence  arose  among 
the  soldiers  settled  on  the  land  a  class  of  rural  debt- 
ors whose  only  recourse  was  frequently  to  sell  their 
land  to  wealthy  owners  of  large  estates.  When  this 
occurred,  the  Eoman  soldiers  could  no  longer  be 
classed  as  farmers,  for  they  had  neither  land  nor  oc- 
cupation. They  could  not  find  employment  as  free 
farm  laborers  because  the  large  landowners  owned 
slaves  and  operated  their  estates  with  this  class  of 
labor.  So  the  soldiers  with  their  families  would  drift 
back  to  Eome  or  to  other  cities,  where  they  increased 
the  number  of  the  lowest  class  of  citizens,  the  so- 
called  proletarius.  When  the  state,  therefore,  un- 
dertook to  establish  soldiers  on  the  land  without 


The  Roman  Land  Settlement  System      39 

providing  for  their  proper  training,  their  protection 
against  usurers,  or  their  sufficient  capitalization,  the 
soldiers  failed  completely  as  farmers. 

On  the  other  hand,  the  large  landed  estates  gradu- 
ally became  ever  larger  as  the  small  soldier  farms 
were  absorbed  therein.  Thus  originated  the  so-called 
"latifundia,"  or  large  estates,  which  were  cultivated 
by  slaves  or  used  for  cattle  grazing.  As  a  matter  of 
fact,  the  tilled  land  on  the  Italian  peninsula  grew 
less  and  less,  because  Eome  began  to  import  her 
cereal  supplies  from  the  provinces  and  free  rural 
labor  slowly  disappeared  altogether  as  slave  labor 
took  its  place. 

The  Agrarian  Struggles 

The  decline  of  the  Eoman  democratic  common- 
wealth cannot  be  separated  from  its  land  settlement 
problem.  At  Eome,  also,  agitation  for  social  re- 
form was  generally  agrarian,  and  the  great  agrarian 
revolution  under  the  Gracchi  cannot  be  clearly  con- 
ceived apart  from  the  history  of  the  public  land. 

So  long  as  there  were  new  conquests  and  addi- 
tional land  was  seized  for  distribution,  the  dis- 
charged soldiers  were  for  a  time  kept  contented. 
But  when  there  was  peace  for  long  periods  and  no 
new  acquisitions  of  land  in  Italy,  the  people  began 
to  agitate  for  a  redistribution  of  the  land,  which  had 
been  largely  absorbed  by  the  rich  landowners.  There 
was  a  demand  for  new  land  legislation.  We  find 


40   The  Place  of  Agriculture  in  Reconstruction 

the  leaders  of  the  dispossessed,  living  as  the  sub- 
merged sixth  or  lowest  class  in  the  city  of  Borne,  con- 
stantly agitating  for  an  agrarian  law  and  contriving 
means  to  check  the  devices  of  those  who  endeavored 
to  elude  it. 

Under  the  commonwealth  the  avowed  patrons  of 
liberty  considered  a  satisfactory  agrarian  law  the 
main  bulwark  of  the  state,  and  they  were  ever  sound- 
ing in  the  ears  of  senators  the  troubles  to  which  they 
were  exposing  themselves  and  threatening  the  wel- 
fare of  the  state  by  its  violation.  "Tell  me," 
Tiberius  Gracchus  could  say  to  the  senate,  "which  is 
the  more  valuable  character,  that  of  a  citizen  or  that 
of  a  perpetual  slave  f  Who  is  more  useful,  a  soldier 
or  a  man  entirely  unfit  for  war?  Will  you,  merely 
for  the  sake  of  enjoying  a  few  more  acres  of  land 
than  your  humbler  fellow-citizens,  lay  aside  the  hopes 
of  conquering  the  rest  of  the  world  or  see  your- 
selves dispossessed  by  the  enemy  of  those  very  lands 
which  you  refuse  to  us  f ' ' 

The  agitation  at  the  time  of  the  Gracchi  (133-121 
B.C.)  resulted  in  a  change  being  brought  about  in 
the  distribution  of  land.  The  agrarian  proposal  of 
Tiberius  Gracchus  was  that  each  family  should  be 
allotted  30  jugera  of  land.1  But  again  no  further  ef- 
forts were  made  to  provide  operating  capital  for  the 
new  occupiers,  both  soldiers  and  citizens.  It  was 

JA  jugerum  equals  28,800  square  feet;  an  acre  consists  of  43,560 
square  feet.  An  allotment,  therefore,  at  this  time  amounted  to  about 
20  acres  of  land. 


The  Roman  Land  Settlement  System       41 

not  long  under  these  conditions  before  the  new  land- 
owners had  sold  their  small  holdings  and  again 
joined  the  discontented  hosts  of  Koine's  proletariat. 
It  becomes  evident,  therefore,  that  the  mere  allot- 
ment of  land  to  soldiers  is  not  a  safe  or  sufficient 
assurance  of  land  settlement  and  productive  agricul- 
ture. 

,  With  the  growth  of  wealth  on  one  hand  and  an 
increase  in  the  proletariat  in  the  cities  on  the  other 
hand,  the  agrarian  struggles  became  a  poor  outlet 
for  a  crude  state  land  settlement  policy.  The 
avarice  of  the  rich  and  the  financial  needs  of  the 
farmer  soldiers  occasioned  the  land  to  become  the 
property  of  a  few  citizens.  Arts  and  trades  were  in- 
troduced to  supply  the  wants  of  the  rich  and  to  fur- 
nish employment  for  the  poor.  But  in  either  agri- 
culture or  the  trades  few  soldiers  or  free  citizens 
were  engaged.  For  the  revenues  from  the  lands, 
which  earlier  had  been  employed  to  support  free 
landowners,  were  now  wholly  expended  on  slaves 
who  labored  to  produce  food  and  luxuries  for  the  new 
landowning  proprietors.  But  if  either  Tiberius  or 
Caius  Gracchus  had  succeeded  in  their  scheme  of  re- 
forming the  land  settlement  policy  of  the  Roman 
commonwealth,  the  loss  of  liberty,  with  all  the  conse- 
quent miseries  which  befell  the  state,  might  have 
been  prevented.  But  their  untimely  fate  discouraged 
others  from  following  in  their  footsteps  by  endeavor- 
ing to  establish  a  more  rational  system  of  land  set- 


42  The  Place  of  Agriculture  in  Reconstruction 

tlement  by  soldiers  and  citizens.  As  a  result,  in- 
stead of  being  defended  by  her  own  legions,  the  com- 
monwealth became  a  prey  to  them.  In  this  there  is 
no  cause  for  surprise  considering  the  fact  that  the 
soldiers  no  longer  had  any  property  in  the  state,  but 
might  hope  to  acquire  more  from  its  overthrow  than 
by  its  preservation.  They  were  easily  led,  there- 
fore, to  conspire  to  its  fall.  Taken  all  together  these 
were  the  elements  which  largely  contributed  to  the 
ruin  of  Rome  and  Italy. 

Land  Settlement  a  Complex  Problem 

As  stated  before,  the  problem  raised  by  de- 
mobilization of  armies  and  navies  is  not  a  new  one. 
A  great  difference,  however,  between  past  wars  and 
the  European  war  is  the  number  of  men  involved  and 
the  larger  problems  which  must  be  met  for  many 
years  after  the  return  of  peace.  But  at  the  end  of 
all  wars  the  first  question  which  has  always  arisen 
has  been  How  to  find  employment  for  the  men  who 
were  mustered  out  of  military  service? 

This  question  was  always  before  the  Eoman  senate 
and  it  is  now  uppermost  in  the  thought  of  those  upon 
whom  the  responsibility  of  modern  government  has 
been  placed.  It  is  believed  that  the  experience  of 
past  wars  points  out  the  lesson  that  soldiers  and 
sailors,  because  of  the  open-air  activity  of  military 
service,  will  desire  to  continue  such  out-of-door  work 
as  farming  and  stock  raising  offer.  This  fact  is  large- 


The  Roman  Land  Settlement  System      43 

ly  accepted  by  labor  organizations  and  the  govern- 
ments of  the  allied  nations.  But  the  problem  is 
more  than  that  of  simply  taking  up  land  and  be- 
ginning life  anew.  For  the  factors  of  production 
are  land,  labor  and  capital.  In  settling  soldiers  and 
sailors  on  the  land,  there  must  be  taken  into  consid- 
eration not  only  the  problem  of  providing  land,  but 
also  the  adaptability  of  the  man  for  any  particular 
line  of  farm  work  and  the  method  of  financing  him 
in  his  new  occupation.  This  lesson  is  clearly  taught 
by  the  experience  of  Borne.  To  put  men  on  the  land 
and  leave  them  there  without  any  other  care  or  con- 
sideration is  to  doom  such  land  settlement  scheme 
to  failure  from  the  beginning.  No  sound  program, 
therefore,  can  be  formulated  without  a  careful  con- 
sideration of  all  three  factors  of  wealth  production 
in  their  relation  to  demobilization  and  land  settle- 
ment by  our  soldiers  and  sailors. 

Another  lesson  plainly  shown  is  that  the  problem 
necessarily  varies  in  different  countries,  and  is  ex- 
ceedingly complex  in  character.  It  is  taken  for 
granted  that  demobilization  will  furnish  an 
abundance  of  labor.  The  question  which  will  con- 
front the  nations  during  and  after  the  period  of 
demobilization  is  How  to  provide  land  and  capital 
for  the  large  number  of  workers  who  may  desire 
to  engage  in  productive  agriculture? 

The  three  things  to  consider  are : 


44   The  Place  of  Agriculture  in  Reconstruction 

(1)  The  amount  and  kind  of  land  available  for 
distribution  or  settlement. 

(2)  The  adaptability  of  the  ex-service  settler  for 
the  kind  of  agriculture  practised  in  any  particular 
country  of  Europe  or  for  carrying  on  the  different 
types  of  farming  and  stock  raising  in  countries  like 
Canada  and  the  United  States,  where  land  areas  are 
more  extensive. 

(3)  The  amount  of  capital  available  to  the  in- 
dividual settlers  and  a  satisfactory  method  of  pro- 
viding capital  for  ex-service  men  in  order  that  they 
might  operate  their  farms  successfully. 

With  these  factors  of  the  problem  before  us,  as 
deduced  from  the  long  experience  of  the  Eoman 
commonwealth,  let  us  see  what  the  nations  at  war 
have  done  or  propose  to  do  in  their  attempts  to  es- 
tablish land  settlement  schemes  for  soldiers  and 
sailors  on  a  solid  foundation. 


CHAPTER   in.  —  PEOPOSED    SYSTEMS    OF 
LAND  SETTLEMENT  IN  GEEAT  BEITAIN 

The  schemes  for  land  settlement  by  ex-service  men 
of  the  British  Empire  may  be  viewed  from  two 
standpoints,  namely,  that  of  the  labor  unions  and 
that  of  the  government.  As  representing  a  large 
part  of  the  industrial  workers  of  Great  Britain,  a 
scheme  of  land  nationalization  is  advocated  by  the 
British  Labor  Party.  The  government  on  the  other 
hand  has  set  in  motion  an  individual  small-holdings 
system  of  farms  for  soldiers  and  sailors  as  well  as 
the  cooperative  operation  of  large  farms  on  a  profit- 
sharing  basis.  The  strength  and  the  weakness  of 
these  two  systems  will  be  discussed  in  the  present 
chapter. 

A  Radical  Program  by  British  Labor 

One  of  the  planks  of  the  British  Labor  Party  is 
government  control  of  the  nation's  agricultural 
land.  This  in  itself  is  a  stupendous  undertaking. 
It  looks  almost  like  confiscation,  since  no  plan  of 
acquiring  the  land  is  proposed.  The  object  is  to  give 
every  soldier  or  sailor  a  farm  holding  who  may 
choose  that  line  of  occupation.  In  this  proposition 

45 


46  The  Place  of  Agriculture  in  Reconstruction 

no  consideration  is  given  to  the  adaptability  of  the 
man  for  the  work  or  to  the  method  of  financing  the 
occupant  until  he  becomes  self-supporting. 

The  confiscatory  nature  of  this  plan  is  shown  by 
the  party's  attitude  toward  land  taxation.  In  fact 
it  is  proposed  to  revise  the  whole  system  of  British 
land  taxation  "so  that,  by  the  direct  taxation  of  the 
unearned  increment  of  land  values,  effect  should  be 
given  to  the  fact  that  the  land  of  the  nation  which 
has  been  defended  by  the  lives  and  sufferings  of  its 
people,  shall  belong  to  the  nation,  and  be  used  for 
the  nation's  benefit. " 

Evidently  this  program  proposes  a  system  of  land 
nationalization  as  the  first  step  in  providing  farms 
for  returned  soldiers  and  sailors.  But  the  program 
of  the  British  Labor  Party  goes  much  farther.  It 
advocates  the  reconstruction  of  agriculture  and  rural 
life  without  any  regard  whatever  to  the  economics 
of  the  problem.  Here  follows  the  program  in  full : 

' i  1.  The  conference  [of  the  British  Labor  Party] 
regards  the  present  arrangements  for  the  produc- 
tion and  distribution  of  food  in  this  country,  and  the 
life  to  which  many  thousands  of  country  dwellers  are 
condemned,  as  nothing  short  of  a  national  disgrace 
and  as  needing  to  be  radically  altered  without  de- 
lay. 

"2.  It  is  essential  that  the  government  should 
resume  control  of  the  nation's  agricultural  land,  and 
ensure  its  utilization  not  for  rent,  not  for  game,  not 


Proposed  Systems  of  Land  Settlement      47i 

for  the  social  amenity  of  a  small  social  class,  not 
even  for  obtaining  the  largest  percentage  of  the 
capital  employed,  but  solely  with  a  view  to  the  pro- 
duction of  the  largest  possible  portion  of  the  food- 
stuffs required  by  the  population  of  these  islands 
under  conditions  allowing  of  a  good  life  to  the  rural 
population  and  at  a  price  not  exceeding  that  for 
which  foodstuffs  can  be  bought  from  other  lands. 

"3.  This  end  can  probably  best  be  attained  by  a 
combination  of  (1)  government  farms,  administered 
on  a  large  scale  with  the  utmost  use  of  machinery; 
(2)  small  holdings  made  accessible  to  practical  agri- 
culturists; (3)  municipal  enterprises  in  agriculture, 
in  conjunction  with  municipal  institutions  of  various 
kinds,  milk  depots,  sewage  works,  etc.;  and  (4) 
farms  let  to  cooperative  societies  and  other  tenants, 
under  covenants  requiring  the  kind  of  cultivation 
desired. 

"4.  Under  all  systems  the  agricultural  laborer 
must  be  secured  a  healthy  and  commodious  cottage, 
with  sufficient  garden  ground,  the  opportunity  of 
getting  an  accessible  allotment,  and,  when  he  so 
desires,  a  small  holding,  together  with  a  wage  con- 
tinuously adequate  for  the  requirements  of  body  and 
mind. 

"5.  The  conference  suggests  that  the  distribu- 
tion of  foodstuffs  in  the  towns — from  milk  and  meat 
to  bread  and  vegetables — should,  with  equitable 
compensation  for  all  interests  expropriated  and  per- 


48    The  Place  of  Agriculture  in  Reconstruction 

sons  displaced,  be  taken  out  of  the  hands  of  the  pres- 
ent multiplicity  of  dealers  and  shopkeepers,  and  or- 
ganized by  consumers,  cooperative  societies,  and  the 
local  authorities  working  in  conjunction. " 

Here,  then,  in  outline  is  a  proposal  to  establish  sol- 
diers and  sailors  on  farms  under  a  system  of  land 
nationalization  so  far  as  production  is  concerned, 
and  a  cooperative  commonwealth  in  the  matter  of 
food  distribution.  The  present  multiplicity  of  deal- 
ers and  shopkeepers  thus  displaced  must  be  provided 
for  by  "equitable  compensation."  This  is  dis- 
missing the  financial  end  of  the  great  problem  of  land 
settlement  by  returned  military  men  with  two  words. 
It  does  not  take  into  consideration  the  matter  of  con- 
tinuing taxation,  increasing  national  debt,  and  the 
payment  of  interest  thereon. 

From  the  standpoint  of  the  general  welfare,  these 
are  no  less  important  problems  than  those  connected 
with  establishing  soldiers  and  sailors  on  the  land. 
Taxation  is  simply  the  reflex  of  government  expendi- 
tures. When  the  latter,  because  of  extraordinary 
emergencies  such  as  the  European  war,  can  only  be 
partly  met  by  immediate  taxation,  recourse  must  be 
had  to  national  debt,  the  interest  on  which  becomes 
either  an  additional  necessity  for  increasing  existing 
taxation  or  results  in  a  more  rapid  increase  in  the 
debt  itself.  Nations  like  individuals  must  either  pay 
their  debts  with  interest  or  repudiate  them.  The 
former  hitherto  has  been  the  practise  of  civilized 


Proposed  Systems  of  Land  Settlement      49 

nations ;  the  latter  is  an  important  step  toward  na- 
tional anarchy. 

Evidently  no  satisfactory  program  of  land  settle- 
ment by  returned  military  men  can  be  devised  with- 
out taking  into  consideration  all  three  factors  of  the 
land,  the  man,  and  the  capital.  Possibly  the  most 
important  of  these  factors  is  that  of  capitalization. 
The  problem  is  to  avoid  an  increase  of  taxation  or 
of  debt  while  accomplishing  the  recognized  benefits 
of  land  settlement.  The  object  is  to  keep  the  ma- 
chinery of  civilized  government  running  as  smoothly 
and  as  cheaply  as  possible,  even  under  the  most  diffi- 
cult of  labor  problems  which  demobilization  will  not 
only  bring  into  existence,  but  which  will  continue  for 
many  years  after  peace  has  been  declared.  Such  a 
task  cannot  be  accomplished  without  serious  thought 
and  most  careful  consideration.  The  world  is  not 
desirous  of  witnessing  among  the  allied  nations  an- 
other such  a  disastrous  economic  and  political  revo- 
lution as  took  place  in  Eussia,  where  it  was  sought 
to  accomplish  a  cooperative  commonwealth  by  the 
mere  ipse  dixit  of  a  few  irresponsible  men.  The 
promise  of  successful  land  settlement  lies  not  in 
revolution  but  in  due  consideration  of  economic  laws 
which  make  for  the  most  stable  communal  and  na- 
tional life. 


50  The  Place  of  Agriculture  in  Reconstruction 

The  British  Government  Plan 

As  stated  before,  the  government  scheme  for  land 
settlement  by  ex-service  men  of  the  British  Empire 
includes  an  individual  small  holdings  system  and  the 
operation  of  large  farms  on  a  profit-sharing  basis. 

Under  the  Small  Holdings  Colonies  Act,  approved 
August  23,  1916,  authority  is  given  to  the  Board  of 
Agriculture  and  Fisheries  to  acquire  and  manage 
land  for  experimental  small  holding  colonies.  But 
the  total  area  of  land  that  could  be  acquired  was  not 
to  exceed  six  thousand  acres  in  England  and  Wales 
together  and  two  thousand  acres  in  Scotland. 

It  was  soon  realized  that  the  amount  of  land  au- 
thorized to  be  acquired  was  far  too  limited  to  serve 
the  purposes  intended.  Consequently  the  act  was 
amended  in  July,  1918,  to  permit  the  board  to  ac- 
quire sixty  thousand  acres  in  England  and  Wales 
and  twenty  thousand  acres  in  Scotland. 

The  object  was  to  encourage  land  settlement  by 
persons  who  had  served  in  the  naval  or  military 
forces  of  the  British  Empire  in  the  European  war, 
either  as  individuals  or  by  the  formation  or  exten- 
sion of  societies  on  a  cooperative  or  co-partnership 
basis.  The  board  was  authorized  to  promote  the  es- 
tablishment or  profitable  working  of  holdings 
whether  in  relation  to  the  purchase  of  requisites, 
the  sale  of  produce,  credit  banking,  insurance,  or 
otherwise,  and  to  assist  any  such  society  by  making 


Proposed  Systems  of  Land  Settlement      51 

grants  or  advances,  or  guaranteeing  advances  made 
to  the  society,  upon  such  terms  and  conditions  as  to 
rate  of  interest  and  repayment  or  otherwise,  and  on 
such  security  as  the  board  may  think  fit.  The  board 
was  also  authorized  to  transfer  to  any  such  society 
the  whole  or  any  portion  of  any  colony  of  small 
holdings  provided  for  under  the  act. 

In  the  case  of  individuals  the  law  authorized  the 
board  '  '  to  sell  or  exchange  the  land  so  that  the  pur- 
chase money  on  the  sale  of  a  small  holding  to  a  per- 
son willing  himself  to  cultivate  the  holding  may  be 
made  payable  in  periodical  instalments  or  otherwise 
as  the  Treasury  may  direct. ' ' 

By  the  end  of  June,  1918,  the  board  had  acquired 
three  estates  in  England  and  one  in  Wales  for  the 
purpose  of  giving  a  trial  to  land  settlement  by  ex- 
service  men  under  a  colony  system.  In  England  the 
estates  contained  2,363,  1,000,  and  1,150  acres,  re- 
spectively; while  in  Wales  the  estate  acquired  con- 
tained 1,345  acres. 

The  distinctive  feature  of  this  plan  was  its  com- 
munal or  cooperative  basis  for  the  promotion  of  the 
advantages  of  rural  social  life,  cooperative  buying 
and  selling  of  produce,  and  the  joint  use  of  horses, 
implements  and  machinery.  It  was  proposed  that 
the  settlers  should  work  on  a  colony  either  as  in- 
dividual small  holders  or  as  members  of  a  com- 
munity which  would  share  the  profits  derived  from 
operating  the  colony  as  one  large  farm. 


52  The  Place  of  Agriculture  in  Reconstruction 

As  a  general  rule  each  applicant  was  required  to 
work  as  an  ordinary  wage-earning  farm  laborer  un- 
til such  time  as  the  board  was  satisfied  that  he  was  a 
suitable  person  to  remain  at  the  colony.  During  such 
period  he  was  to  be  considered  as  being  on  probation^ 
Where  an  occupant  had  received  previous  farm 
training,  the  period  of  probation  need  not  be  en- 
forced. 

The  British  government  plan  of  land  settlement 
by  soldiers  and  sailors  thus  embodied  two  kinds  of 
colony,  each  with  a  distinct  method  of  operation. 
One  was  the  individual  small  holding  method,  the 
other  was  the  profit-sharing  system. 

1.  Individual  small  holdings.  Under  this  system 
the  colony  is  operated  as  one  large  farm  under  the 
management  of  a  director.  Selected  applicants  are 
employed  as  farm  laborers,  at  the  rate  of  wages  cur- 
rent in  the  district,  for  such  period  of  probation  as 
is  deemed  necessary. 

At  the  end  of  the  training  period  any  approved 
applicant  is  allotted  as  much  land  as  he  is  likely  to 
cultivate  successfully  by  his  own  effort  and  at  a 
reasonable  but  economic  rent.  If  this  land  area  is 
not  sufficient  to  enable  an  occupant  to  obtain  a  living 
therefrom,  he  has  the  privilege  of  working  part  of 
his  time  at  day-laborer's  wages  either  on  the  undi- 
vided portion  of  the  colony  land  or  on  other  farms  in 
the  district.  When  his  growing  ability  and  capital 


Proposed  Systems  of  Land  Settlement      53 

justify  an  increase  in  his  land  area,  he  is  allotted 
more  land  until  he  has  a  farm  large  enough,  when 
properly  cultivated,  to  support  himself  and  family 
thereon. 

But  even  when  all  the  land  on  each  estate  intended 
for  small  holdings  has  been  taken  up,  a  certain  por- 
tion is  to  be  retained  as  a  central  farm  under  the 
management  of  a  director.  This  colony  farm  is  to 
be  equipped  with  sufficient  machinery,  implements, 
horses  and  so  on  to  let  on  hire  to  occupants  who 
may  require  them. 

In  matters  connected  with  the  operation  and  man- 
agement of  their  holdings  and  the  disposal  of  their 
products,  the  advice  and  assistance  of  the  farm  di- 
rector is  always  available  to  settlers.  Moreover, 
a  cooperative  depot  is  established  for  each  colony, 
through  which  occupants  may  purchase  their  agri- 
cultural and  domestic  requirements,  as  well  as  dis- 
pose of  their  products. 

The  manner  of  capitalizing  these  settlements 
avoids  every  semblance  of  paternalism.  The  govern- 
ment makes  no  direct  advances  of  capital  to  ex- 
service  men  who  take  up  small  holdings.  It  is  ex- 
pected that  industrious  men,  when  not  possessed  of 
sufficient  capital  to  take  up  an  economic  holding,  will 
start  as  farm  laborers  on  the  central  farm  and  cul- 
tivate a  small  acreage  on  their  own  account  at  the 
same  time.  In  this  way  it  is  hoped  to  train  them  so 
that  they  will  gradually  increase  the  land  area  under 


54  The  Place  of  Agriculture  in  Reconstruction 

their  own  control  until  it  becomes  an  economic  hold- 
ing and  they  can  support  themselves  and  their  fami- 
lies entirely  from  that  source. 

In  the  selection  of  settlers  for  these  colonies,  pref- 
erence is  given  as  between  men  of  equal  capital, 
merit  and  qualifications,  to  those  whose  wives  or 
other  relatives  have  acquired  some  knowledge  of 
farm  work  as  a  result  of  their  employment  on  the 
land  either  before  or  during  the  war. 

2.  Profit-sharing  farms.  Under  this  system  a 
colony  is  managed  by  a  director  as  one  farm,  the  oc- 
cupants being  employed  by  him  as  farm  laborers  at 
the  current  rate  of  wages  for  the  district,  but  re- 
ceiving in  addition  a  share  of  any  profits  arising  out 
of  the  farming  operations. 

If  an  occupant  so  desires,  however,  he  is  provided 
with  about  one-half  acre  of  land  adjoining  or  near 
his  cottage.  If  he  raises  any  surplus  products,  he 
is  also  helped  to  sell  it. 

The  practical  working  of  the  profit-sharing  sys- 
tem is  as  follows:  The  current  rate  of  interest  at 
5%  per  cent  is  first  deducted  and  charged  against 
the  capital  investment.  Then  the  operating  expenses 
of  the  farm,  the  rent,  taxes,  cost  of  repairs,  and  other 
annual  charges  are  paid,  and  a  percentage  of  the 
income  is  placed  in  a  reserve  fund.  The  balance  of 
the  income  is  divided  as  profits  between  capital, 
management,  and  labor.  The  dividend  allotted  to 


Proposed  Systems  of  Land  Settlement      55 

the  farm  laborers  is  in  proportion  to  the  amount  al- 
ready paid  out  to  them  during  the  year  as  wages. 

Farm  settlers  under  the  colony  system  are  entitled 
to  invest  any  portion  of  their  share  of  the  profits  or 
any  other  money  in  the  capital  of  the  farm.  These 
shares  are  entitled  to  interest  at  the  current  rate  of 
5%  per  cent.  Should  settlers  who  hold  capital 
shares  leave  the  farm,  or  in  case  of  their  death,  the 
shares  are  repaid  to  them  or  their  heirs. 

The  estate  of  2,363  acres  near  Patrington  in  East 
Yorkshire  is  being  operated  on  the  profit-sharing 
plan,  the  land  being  especially  adapted  for  wheat 
raising  and  general  mixed  farming.  Eventually, 
however,  a  limited  number  of  settlers  will  be  pro- 
vided with  separate  small  farms  on  a  portion  of  the 
estate  after  they  have  served  a  period  of  probation 
as  farm  laborers. 

The  1,000-acre  farm  is  situated  near  Holbeach, 
South  Lincolnshire,  the  land  being  especially  suit- 
able for  the  production  of  fruit,  potatoes,  and  mar- 
ket garden  or  truck  crops.  This  farm  is  operated 
on  the  individual  small  holding  system,  with  80  farms 
each  about  10  acres  in  size.  Each  of  these  small 
farms  is  equipped  with  a  cottage  and  the  necessary 
building  equipment. 

The  other  estate  acquired  in  England  consists  of 
1,150  acres,  is  situated  near  Newport,  Shropshire, 
and  the  soil  is  adapted  to  market  gardening  and 
dairying.  This  estate  is  operated  partly  on  the  in- 


56  The  Place  of  Agriculture  in  Reconstruction 

dividual  small  holding  plan  and  partly  on  the  profit- 
sharing  system.  Each  small  farm  will  average  about 
20  acres  in  size  and  will  be  properly  equipped  as 
above  described. 

The  colony  in  Wales  comprises  an  estate  of  1,345 
acres  of  rich  alluvial  soil,  situated  at  Pembrey  on  the 
coast  of  Carmarthenshire.  It  is  near  good  markets 
and  is  suitable  for  market  gardening  and  dairying. 
This  colony  is  operated  on  the  individual  small  hold- 
ing system. 

In  establishing  these  experimental  colony  systems 
the  British  government  is  avoiding  as  much  as  pos- 
sible the  idea  of  paternalism.  Discharged  soldiers 
and  sailors  are  instructed  in  the  principles  and  prac- 
tise of  different  lines  of  agricultural  and  horticul- 
tural pursuits,  including  general  farming,  market 
gardening,  fruit  culture,  dairying,  poultry  raising, 
and  other  lines  of  intensive  crop  production.  The  ob- 
ject is  to  train  these  men  to  become  self-reliant  farm 
owners  and  operators  on  holdings  large  enough  to 
maintain  themselves  and  their  families.  During  their 
period  of  training  or  probation  the  settlers  work  as 
farm  laborers  at  the  current  rate  of  wages.  The 
British  government  makes  no  direct  advances  of 
capital  to  these  prospective  farm  settlers  at  any 
period  of  their  work  and  occupancy.  In  other  words, 
the  ex-service  men  earn  what  they  get  as  wages  and 
no  element  of  philanthropy  whatsoever  enters  into 
these  land  settlement  schemes. 


Proposed  Systems  of  Land  Settlement      57 

3.  Lines  of  work  for  disabled  men.  The  problem 
of  finding  places  for  training  in  agriculture  of  dis- 
abled men  is  entrusted  primarily  to  local  war  pen- 
sions committees.  Notwithstanding  the  growth  of 
industrialism  in  Great  Britain  and  its  limited  land 
area,  agriculture  still  employs  a  far  larger  number 
of  men  than  any  other  single  industry  in  the  coun- 
try. 

A  large  number  who  left  the  land  to  serve  in  the 
fighting  forces  of  the  empire  have  fallen  during  the 
war,  thus  depleting  the  number  that  originally  were 
capable  of  performing  farm  labor.  It  is  also  feared 
that  many  men  who  formerly  worked  on  the  land 
may  take  to  other  occupations  or  emigrate  to  the 
Dominion  countries.  There  is  the  prospect,  there- 
fore, that  there  will  be  a  scarcity  of  farm  labor  after 
the  war  and  that  every  effort  should  be  made  to 
enlist  disabled  men  to  learn  and  engage  in  some 
branch  of  agriculture. 

As  regards  disabled  men,  the  British  government 
takes  the  position  that  those  who  have  had  previous 
agricultural  experience  will  in  most  cases  be  the 
best  judges  how  far  they  will  be  able  to  resume  their 
former  work  or  in  what  other  lines  of  farm  work 
their  previous  experience  will  be  of  service  to  them. 
In  view  of  the  great  demand  for  agricultural  labor, 
there  is  little  likelihood  that  men  who  have  had  ex- 
perience in  farm  work  will  have  any  difficulty  in  find- 


58  The  Place  of  Agriculture  in  Reconstruction 

ing  employment  at  their  particular  kind  of  work,  ex- 
cept in  cases  of  serious  disablement. 

For  those  unfamiliar  with  agricultural  pursuits 
the  difficulties  will  naturally  be  greater.  But  agri- 
culture and  related  industries  offer  many  kinds  of 
openings,  some  of  which  are  well  adapted  for  par- 
tially disabled  men.  Among  these  may  be  men- 
tioned agricultural  motor  tractor  work,  general  farm 
labor,  dairying,  forestry,  horticulture,  market  gar- 
dening, fruit  growing,  poultry  raising,  and  bee  keep- 
ing. The  British  government,  therefore,  has  planned 
to  give  disabled  men  the  privilege  of  being  trained 
along  any  of  these  lines  which  their  inclinations  and 
injuries  best  fit  them  to  practise  most  successfully. 

Farm  Work.  The  work  of  a  general  farm  laborer 
is  not  regarded  as  suitable  for  men  suffering  from 
any  serious  physical  disability.  It  not  only  involves 
a  large  amount  of  heavy  labor,  but  renders  one  liable 
to  long  exposure  to  inclement  weather.  At  the  same 
time,  the  comparative  quiet  of  country  lif e  and  the 
open-air  conditions  seem  to  be  especially  advisable 
for  men  suffering  from  shell  shock  or  other  nervous 
derangement. 

So  far  as  general  farm  work  is  concerned,  it  is 
believed  that  there  is  only  a  limited  opening  for 
disabled  men  and  that  the  possibility  of  obtaining 
work  in  any  specialized  f  orm  of  employment  depends 
largely  upon  local  conditions  and  markets.  Local 
committees  are  therefore  urged  to  institute  inquiries 


Proposed  Systems  of  Land  Settlement      59 

as  to  the  suitability  of  the  employment,  the  number 
of  applicants,  and  the  extent  of  the  demand  for  la- 
borers in  their  own  and  adjoining  districts. 

Dairying.  In  Great  Britain  there  is  a  great  de- 
mand for  men  experienced  in  the  care  of  cows  and 
in  milking.  Many  farms  near  thriving  towns  special- 
ize in  milk  production  and  partially  disabled  men 
can  find  work  on  these  farms  at  good  wages. 

The  duties  on  such  dairy  farms  include  the  feed- 
ing of  cows,  light  normal  labor  in  preparing  beet 
pulp,  mixing  and  distribution  of  feeding  stuffs,  clean- 
ing of  cow  sheds,  carrying  litter  for  bedding,  weigh- 
ing of  churns,  and  similar  work.  Most  of  this  labor 
is  performed  indoors. 

Besides  the  work  of  milk  production,  there  is  also 
a  demand  for  men  to  undertake  milk  distribution. 
If  hand  carts  are  used,  this  work  can  be  done  by 
men  who  have  lost  an  arm;  but,  after  a  short  train- 
ing in  driving,  the  distribution  of  milk  by  horse  and 
wagon  can  be  undertaken  by  men  who  have  lost  a 
leg.  Any  man  who  shows  signs  of  tuberculosis  is 
regarded  as  unfit  for  any  branch  of  dairying  in  Great 
Britain  and  would  not  be  trained  for  these  lines  of 
work. 

Forestry.  The  continuance  of  the  war  revealed 
the  necessity  of  extending  the  forest  area  of  the 
United  Kingdom.  After  the  war  there  is  likely  to  be 
a  great  increase  in  forestry  work,  particularly  in 
Scotland.  But  for  those  heavier  tasks  connected 


60  The  Place  of  Agriculture  in  Reconstruction 

with  forestry  work,  such  as  the  felling  of  trees, 
it  is  not  probable  that  many  disabled  men  would 
find  themselves  equal  to  the  tasks.  At  the  same 
time  it  is  recognized  that  they  could  perform  satis- 
factorily many  of  the  lighter  tasks,  such  as  lopping 
limbs  and  dressing  of  fallen  timber,  piling  and  burn- 
ing brush  and  other  debris  on  cut-over  areas,  gather- 
ing and  saving  the  wood  ashes  for  fertilizer  and  other 
industrial  purposes,  planting  young  trees  in  refor- 
ested areas,  and  many  forms  of  tree  nursery  work. 
The  lighter  forms  of  outdoor  forestry  work  are  well 
suited  to  tuberculous  men.  Arrangements  have  been 
made  to  place  disabled  men  in  the  government  woods 
and  on  private  estates.  In  this  connection  facilities 
are  provided  for  selected  men  to  take  courses  of  in- 
struction at  forestry  schools.  On  completing  the 
course  it  is  believed  that  the  most  efficient  men  will 
have  no  difficulty  in  securing  permanent  employment 
as  foresters. 

Horticulture.  This  branch  of  agriculture  offers 
many  possibilities  for  disabled  men.  The  demand 
for  unskilled  laborers  to  work  in  private  gardens  is 
not  large,  but  it  is  maintained  that,  after  the  war, 
there  will  be  a  growing  demand  for  practical  gar- 
deners. Disabled  men  must  look  upon  the  first  year 
of  employment  as  a  period  of  apprenticeship,  during 
which  time  the  wages  would  not  be  large.  But 
when  practical  horticultural  experience  has  been 
acquired,  the  prospects  for  higher  wages  would  in> 


Proposed  Systems  of  Land  Settlement      61 

prove  rapidly.  While  the  prospects  in  flower  and 
shrub  nurseries  are  equally  good,  the  opportunities 
for  employment  are  not  as  numerous. 

Market  gardening.  In  this  line  of  work  the  de- 
mand for  unskilled  labor  in  Great  Britain  is  good 
and  quite  general.  After  a  year's  training  and 
experience  the  prospects  of  employment  are  favor- 
able. The  government,  however,  recommends  that 
disabled  men,  unless  they  possess  at  least  $1000  of 
capital,  should  not  be  encouraged  to  take  up  mar- 
ket gardening  as  a  calling.  Even  with  this  much 
capital,  it  is  believed  that  the  only  avenue  to  suc- 
cess is  practical  training  under  competent  gardeners 
for  at  least  two  years. 

In  this  connection  there  are  openings  for  em- 
ployment in  certain  districts  for  the  raising  of 
tomatoes,  cucumbers,  fruits,  cut  flowers  and  similar 
special  products  in  glass  hot-houses. 

Fruit  growing.  Great  Britain  offers  few  oppor- 
tunities for  disabled  men  in  fruit  culture.  But  in 
a  few  of  the  fruit-growing  districts,  as  in  the  county 
of  Kent,  the  prospects  for  employment  are  particu- 
larly good  for  a  long  season  if  the  men  have  had 
the  experience  and  can  do  such  light  duties  as 
pruning,  grafting,  spraying,  picking,  sorting,  pack- 
ing, and  shipping. 

Poultry  raising.  Under  normal  conditions  poultry 
raising  may  be  made  a  profitable  business,  especially 
when  conducted  in  connection  with  some  other  line  of 


62  The  Place  of  Agriculture  in  Reconstruction 

agricultural  work,  such  as  gardening  or  fruit  culture. 
But  applicants  are  urged  to  take  some  special  train- 
ing to  fit  themselves  for  poultry  keeping.  The 
present  high  price  for  poultry  feeds,  however,  has 
led  to  a  great  reduction  in  the  number  of  modern 
poultry  plants,  so  that  the  opportunities  for  acquir- 
ing experience  in  poultry  culture  are  very  limited 
in  Great  Britain. 

Bee  "keeping.  In  the  case  of  bee  keeping,  this 
should  be  practised  in  connection  with  fruit  raising 
or  gardening.  Training  should  be  had  with  a  prac- 
tical bee  keeper.  But  the  prevalence  of  diseases 
among  bees  renders  the  industry  more  or  less  pre- 
carious, and  it  is  not  recommended  by  the  govern- 
ment except  in  connection  with  some  other  means 
of  livelihood. 

4.  Training  and  financial  aid.  In  a  pamphlet  is- 
sued by  the  British  government,  the  following  broad 
statement  is  made  regarding  agricultural  work  for 
disabled  soldiers  and  sailors: 

"Speaking  generally,  no  form  of  institutional 
training  is  needed  in  connection  with  work  on  the 
land.  On  farms  and  market  gardens  much  of  the 
work  is  of  a  varied  but  simple  manual  type,  the 
exact  nature  and  object  of  which  is  constantly  chang- 
ing from  season  to  season  and  which  only  requires  a 
few  simple  directions  to  be  capably  performed  by 


Proposed  Systems  of  Land  Settlement      63 

a  man  whose  disablement  is  not  absolutely  crip- 
pling." 

At  the  same  time  attention  is  called  to  tjie  fact 
that  there  are  a  number  of  more  or  less  skilled  oc- 
cupations on  farms  which  require  special  knowledge 
and  aptitude,  and  that  practise  and  experience  are 
the  only  means  of  acquiring  this  special  training. 
Among  such  occupations  mention  may  be  made  of 
the  management  of  horses  in  cultivation,  the  seasonal 
operations  of  pruning,  grafting  and  spraying  fruit 
trees,  the  care  of  dairy  cows,  the  making  of  butter 
and  cheese,  and  similar  specialized  lines  of  farm 
work.  In  many  such  branches  of  agriculture  train- 
ing and  experience  are  advantageous  and  even  es- 
sential. But  taking  the  whole  field  of  the  agricul- 
tural industry,  the  work  can  be  acquired  by  those 
possessed  of  average  intelligence  who  have  a  taste 
for  it. 

It  is  also  generally  recognized  that  what  is  chiefly 
needed  is  that  those  disabled  men  who  wish  to  take 
up  farm  work  should  receive  expert  advice  and  guid- 
ance at  first  in  order  that  they  may  find  out  the 
particular  lines  of  work  for  which  they  are  best 
fitted  both  physically  and  temperamentally.  The 
government's  task  is  to  provide  the  training  that  is 
necessary  to  fit  them  for  their  chosen  occupation. 

In  Great  Britain  the  duty  of  providing  this  train- 
ing falls  primarily  on  the  local  war  pensions  com- 
mittees who,  by  availing  themselves  of  the  necessary 


64  The  Place  of  Agriculture  in  Reconstruction 

expert  agricultural  advice,  will  decide  whether  a 
disabled  man  should  or  should  not  be  encouraged 
to  take  up  land  or  enter  upon  a  particular  line  of 
farm  work.  When  a  committee  has  decided  that 
an  applicant  is  fit  to  take  up  some  line  of  farming, 
it  should  make  arrangements  to  place  him  with  an 
experienced  farmer  in  his  chosen  location.  In  this 
connection  local  war  pensions  committees  have  the 
advice  of  agricultural  organizers  of  county  councils 
and  the  agricultural  executive  committees.  If  possi- 
ble arrangements  are  made  for  periodical  visits  to 
the  men  to  learn  how  they  are  progressing. 

In  the  comparatively  few  cases  where  the  local 
war  pensions  committees  think  that  a  special  in- 
stitutional course  of  training  should  be  given,  but 
have  not  made  direct  arrangements  for  the  purpose 
with  an  agricultural  college  or  similar  institution 
recognized  by  the  Board  of  Agriculture,  the  latter 
is  prepared,  in  consultation  with  the  Ministry  of 
Pensions,  to  provide  such  facilities  as  are  necessary 
and  can  be  given.  A  number  of  agricultural  educa- 
tional institutions  are  designated  to  provide  this 
special  training  for  disabled  ex-service  men.  Such 
special  courses,  however,  are  restricted  to  men  who 
either  can  provide  sufficient  capital  to  enable  them  to 
take  up  some  line  of  agriculture  or  horticulture  as 
a  business,  or  who  have  prospects  of  employment  in 
responsible  positions  connected  with  the  land. 

A  disabled  man?  if  eligible  for  governmental  train- 


Proposed  Systems  of  Land  Settlement      65 

ing,  receives  during  his  course  a  minimum  allow- 
ance of  $7.00  a  week,  or  a  larger  sum  in  accordance 
with  his  rank.  If  he  is  married  and  his  training 
requires  him  to  live  away  from  home,  he  is  allowed 
an  additional  minimum  sum  of  $3.50  a  week  for  his 
wife,  or  a  larger  sum  in  accordance  with  his  rank. 
If  he  has  children  he  is  granted  additional  allow- 
ances of  $1.75  a  week  for  the  first  child,  $1.25  for 
the  second,  and  $1.00  for  each  subsequent  child. 
These  are  all  personal  allowances  for  maintenance. 
But  if  a  disabled  man's  training  requires  the 
payment  of  fees,  these  are  also  paid  by  the  govern- 
ment. And,  finally,  on  the  satisfactory  completion  of 
the  course  of  instruction  an  amount  equal  to  $1.25 
for  each  week  the  training  has  lasted  is  paid  to  each 
man  as  a  bonus  for  satisfactory  attendance  and 
progress.  Notwithstanding  these  opportunities  and 
advantages,  toward  the  close  of  1918  the  number 
of  disabled  men  who  had  offered  themselves  for 
training  in  agriculture  was  comparatively  small  ow- 
ing to  the  fact,  no  doubt,  that  they  could  obtain 
employment  at  higher  wages  in  many  of  the  depleted 
urban  industries. 

5.  Wages  and  hours  of  work.  The  period  during 
which  these  allowances  are  paid  varies  according  to 
the  kind  of  farm  or  garden  work  undertaken,  but 
usually  does  not  exceed  six  months.  It  has  been 
deemed  advisable,  however,  to  require  that  dis- 


66  The  Place  of  Agriculture  in  Reconstruction 

abled  men  who  take  up  market  gardening,  horticul- 
ture, and  similar  pursuits  should  receive  instruction 
in  the  operations  adapted  to  all  seasons  of  the  year. 
This  is  arranged  by  placing  men  who  have  had  six 
months'  training  with  employers  who  will  under- 
take to  give  continuous  instruction  while  paying 
reasonable  wages.  This  attitude  is  expected  of 
employers  as  a  patriotic  duty  in  view  of  the  mani- 
fest evidence  of  personal  sacrifice  which  has  been 
made  by  the  disabled  man  whom  he  employs. 

As  a  rule,  however,  the  wages  paid  in  agricultural 
pursuits  are  not  as  high  as  those  which  prevail  in 
towns  or  cities,  while  the  hours  of  labor  are  apt 
to  be  irregular  and  long.  But  these  working  condi- 
tions are  more  than  offset  by  the  simpler  and  health- 
ier conditions  of  country  life  as  compared  with 
town  or  city,  while  the  standard  of  living  is  better 
and  its  cost  much  less. 

In  connection  with  the  regulation  of  wages  and 
hours  of  labor  in  agriculture,  the  British  govern- 
ment passed  a  law  which  authorizes  the  Agricultural 
Wages  Board  to  fix  the  minimum  rates  of  wages  in 
all  departments  of  agriculture  and  forestry  and  to 
determine  the  number  of  hours  which  constitute 
a  day's  work  for  which  not  less  than  said  minimum 
rates  of  wages  shall  be  paid.  These  duties  must  not 
only  necessarily  take  some  time,  but,  on  account  of 
the  precariousness  of  the  agricultural  industry,  fix- 
Ing  minimum  rates  of  wages  for  the  various  lines 


Proposed  Systems  of  Land  Settlement      67 

of  farming  and  gardening  applicable  to  all  parts  of 
Great  Britain  is  a  difficult  task.  In  the  meantime,  the 
law  requires  employers  to  pay  as  wages  not  less 
than  $6.25  a  week  to  an  able-bodied  man,  the  latter 
being  one  who  is  not  incapable  of  doing  the  work 
of  a  normally  efficient  farm  hand  by  reason  of  age, 
mental  infirmity,  or  physical  injury. 

When  once  minimum  wages  and  hours  of  labor 
have  been  fixed,  however,  employers  may  not  pay 
wages  lower  than  the  fixed  rates.  But  the  Agricul- 
tural Wages  Board  has  authority  to  issue  permits 
exempting  from  this  provision  employers  of  men 
whom  they  consider  incapable  of  earning  the  min- 
imum rate  of  wages  because  of  any  mental  or  phys- 
ical infirmity.  Finally  the  Board  of  Agriculture  is 
authorized  to  require  district  wages  committees  to 
submit  to  the  board  for  decision  in  cases  of  doubt 
the  rate  of  wages  which  any  employer  should  pay 
to  any  individual  disabled  man. 


CHAPTER  IV.— ANALYSIS  OF  THE  LAND 
SETTLEMENT  PEOBLEM  IN  GEEAT 
BEITAIN 

The  preceding  chapter  shows  that  the  British 
government  plan  of  settling  discharged  and  dis- 
abled soldiers  and  sailors  on  the  land  is  based  large- 
ly on  strict  business  principles.  So  far  as  able- 
bodied  men  are  concerned,  there  is  little  or  no  pater- 
nalism and  no  excessive  financial  cost  is  laid  upon  the 
government  for  the  training  of  disabled  ex-service 
men  and  fitting  them  to  take  their  place  anew  as 
efficient  economic  units  in  the  production  of  wealth. 
The  period  of  financial  allowances  for  the  disabled 
man  and  his  family  is  not  to  exceed  six  months,  the 
sums  allowed  are  deemed  sufficient  to  cover  about  the 
actual  cost  of  maintenance  only,  and  no  provision 
at  all  is  made  for  aiding  ex-service  men  to  become 
landowners. 

In  its  land  settlement  schemes  the  policy  adopted 
by  the  British  government  has  been  that  of  fitting 
men  to  find  remunerative  employment  in  some  line 
of  farming,  gardening,  poultry  keeping,  and  kindred 
lines  of  work  without  prolonging  the  need  of  high 
government  expenditures  and  consequent  high  tax- 

68 


Analysis  of  the  British  System  69 

ation  for  any  great  length  of  time.  It  is  an  attempt 
to  prepare  the  way  for  a  return  to  normal  economic 
and  social  life  as  quickly  as  possible. 

But  of  the  three  factors  of  wealth  production,  the 
labor  factor  is  the  only  one  in  Great  Britain  which 
offers  little  or  no  difficulty.  Already  there  have  been 
some  applications  for  training  in  agricultural  pur- 
suits and  the  purchase  of  small  farms  or  garden 
holdings,  but  it  is  expected  that  there  will  be  a 
much  greater  demand  for  farms  by  soldiers  and 
sailors  after  the  war.  The  problem  of  land  settle- 
ment in  Great  Britain,  therefore,  centers  in  the  two 
phases  of  providing  both  land  and  capital  for  ex- 
service  men  who  may  desire  to  take  up  some  phase 
of  farm  life.  Let  us  now  consider  these  two  aspects 
of  the  problem. 

A  Limited  Land  Area  for  Exploitation 

The  British  Isles  contain  a  little  less  than  121,000 
square  miles  of  territory  and  have  a  population 
approximating  45,000,000.  Of  this  area  England 
and  Wales  together  contain  58,310  square  miles  and 
have  a  population  of  about  33,500,000. 

In  order  to  indicate  the  problem  of  land  settle- 
ment in  England  and  Wales,  the  two  countries  of 
Great  Britain  concerning  which  the  latest  statistics 
are  alone  available,  let  us  take  one  of  our  own  states 
with  practically  the  same  extent  of  territory.  The 
state  of  Florida  has  an  area  of  58,666  square  miles, 


70  The  Place  of  Agriculture  in  Reconstruction 

but  a  population  in  1910  of  approximately  752,600 
only.  Imagine,  then,  the  state  of  Florida  with  a 
population  about  45  times  as  numerous  as  at  present 
and  we  may  reach  some  conception  of  the  great 
problem  of  land  settlement  so  far  as  the  area  of 
England  and  Wales  is  concerned.  The  total  amount 
of  land  available  for  farming  is  much  too  small  to 
provide  the  food  supplies  of  the  kingdom,  while 
the  area  that  can  be  taken  over  or  acquired  for 
land  settlement  by  soldiers  and  sailors  is  so  limited 
that  the  problem  is  intensified  a  hundred-fold  com- 
pared to  what  it  is  in  the  United  States. 

The  size  of  farms  is  also  a  matter  for  serious 
consideration.  In  the  year  1914,  which  was  not 
affected  by  the  war  so  far  as  area  under  cultivation 
is  concerned,  the  total  area  under  crops  and  grass 
in  England  and  Wales  was  27,114,000  acres,  while 
the  area  of  holdings  above  1  acre  and  not  exceeding 
50  acres  in  size  was  4,286,000  acres.  Thus  nearly 
16  per  cent  of  the  land  under  cultivation  and  in 
grass  in  England  and  Wales  are  in  small  gardens 
and  farms  less  than  50  acres  in  size. 

During  the  war  there  was  a  great  increase  in  the 
cultivated  area  as  compared  with  the  land  in  grass. 
In  a  speech  in  the  House  of  Commons  on  July  18, 
1918,  Hon.  E.  E.  Prothero,  chairman  of  the  Board 
of  Agriculture,  said  that  the  arable  area  had  in- 
creased in  1917  by  2,142,000  acres.  Of  this  area, 
the  cultivation  of  wheat  was  increased  by  752,000 


Analysis  of  the  British  System  71 

acres,  barley  158,000  acres,  oats  735,000  acres,  rye, 
peas  and  beans  280,000  acres,  and  potatoes  217,000 
acres.  This  increase  in  arable  area  was  brought 
about  by  a  great  number  of  small  farmers  rather 
than  of  large  farmers,  notwithstanding  there  was  a 
severe  shortage  of  farm  labor  during  the  year. 
At  the  same  time  the  chairman  of  the  Board  of 
Agriculture  reported  there  was  "a  most  substantial 
improvement  in  the  general  standard  of  farming 
throughout  the  country." 

When  the  European  war  broke  out  in  August, 
1914,  the  Small  Holdings  and  Allotments  Act  had 
been  in  operation  in  England  and  Wales  for  nearly 
seven  years.  This  law  was  passed  for  the  purpose 
of  encouraging  city  and  town  dwellers  to  take  up 
life  in  the  country  either  as  tenants  or  owners,  and 
it  went  into  effect  on  January  1,  1908.  Up  to  the 
close  of  December,  1914,  the  Board  of  Agriculture 
and  Fisheries,  which  had  authority  to  carry  out  the 
provisions  of  the  law,  had  acquired  by  purchase  139,- 
478  acres  at  an  average  price  of  about  £33,  or  $160, 
an  acre.  In  addition  the  board  had  leased  58,810 
acres,  which  land  was  rented  to  tenants  in  small 
holdings.  The  total  amount  of  land  acquired  by  the 
board  was  198,288  acres  in  seven  years. 

These  data  show  the  difficulty  the  Board  of  Agri- 
culture had  for  seven  years  before  the  war  in  ac- 
quiring land  for  settlement  purposes  and  the  high 
price  at  which  the  land  was  bought.  As  a  matter  of 


72  The  Place  of  Agriculture  in  Reconstruction 

fact  land  for  agricultural  purposes  had  slowly  in- 
creased in  value.  In  1914  the  average  price  of  the 
land  purchased  by  the  board  for  small  holdings  was 
£36,  or  $175,  an  acre ;  while  no  less  than  13,628  acres 
of  land  on  which  the  county  councils  had  options, 
could  not  be  purchased  because  the  land  sold  for 
prices  in  excess  of  the  limits  authorized  by  the 
Board  of  Agriculture.  The  small  amount  of  land 
available  for  purchase  in  England  and  Wales,  as 
well  as  the  high  land  values  in  those  two  countries, 
makes  the  problem  of  land  settlement  by  soldiers 
much  harder  to  solve  than  in  almost  any  other 
country  in  the  world.  After  a  careful  review  of  all 
the  facts  bearing  upon  the  land  problem  in  Great 
Britain,  the  chairman  of  the  Board  of  Agriculture 
stated  to  the  House  of  Commons  in  July,  1918,  that 
no  adequate  provision  "has  yet  been  made,  or  even 
foreshadowed,  for  the  great  want  there  will  be  for 
land  after  demobilization.  The  board's  plans  for 
providing  for  the  wants  of  demobilized  soldiers  and 
sailors  have  been  before  the  government  for  some 
time  and  are  still  under  consideration." 

In  the  issue  of  The  Journal  of  the  Board  of 
Agriculture  for  February,  1919,  p.  1368,  a  notice 
sent  out  by  the  board  declares  that  "it  will  prob- 
ably prove  to  be  physically  impossible  to  acquire, 
adapt  and  equip  sufficient  land  to  satisfy  the  total 
number  of  likely  applicants. " 

In  view  of  these  facts  concerning  the  extent  of 


Analysis  of  the  British  System  73 

land  available  for  farming  purposes  in  Great  Britain, 
how  impossible  of  execution  seems  the  proposed 
program  of  the  British  Labor  Party,  namely,  to 
nationalize  all  the  land  and  provide  every  demo- 
bilized soldier  or  sailor  with  a  farm.  The  area 
for  exploitation  is  so  limited,  the  land  is  so  high 
in  price,  and  the  number  of  demobilized  ex-service 
men  who  might  take  up  farming  or  gardening  for 
a  post-war  means  of  earning  a  living  may  be  so 
large  that  the  whole  problem  is  giving  the  British 
government  no  small  concern.  The  mere  ipse  dixit 
of  any  political  party,  no  matter  how  well-meaning 
its  intentions  may  be,  cannot  solve  the  problem  of 
Great  Britain's  limited  land  area  in  relation  to  the 
great  labor  problem  caused  by  demobilization.  The 
only  practical  solution  of  the  problem  seems  to  lie 
not  in  extensive  farming,  but  in  an  extension  of 
the  allotment  scheme  for  industrial  workers  and 
of  small  holdings  for  intensive  gardening  and  farm- 
ing. The  Small  Holdings  Colonies  Act  of  1916, 
therefore,  is  a  step  in  the  right  direction  as  a  means 
of  absorbing  demobilized  soldiers  who  might  desire 
to  take  up  an  agricultural  mode  of  life. 

Classes  of  Farm  Occupants 

This  naturally  leads  us  to  a  consideration  of  the 
second  essential  factor  in  wealth  production,  name- 
ly, the  amount  and  kind  of  labor  occupied  on  small 
holdings.  During  the  seven  years  of  the  operation 


74  The  Place  of  Agriculture  in  Reconstruction 

of  the  Small  Holdings  and  Allotments  Act  before 
the  war,  was  the  tendency  of  those  who  took  up 
holdings  to  become  landowners  or  tenants?  Would 
the  average  demobilized  soldier  or  sailor  in  Great 
Britain  be  able  to  take  up  an  economic  holding 
as  an  owner  with  land  selling  at  not  less  than  $160 
an  acre?  The  financial  condition  of  the  applicant, 
as  well  as  the  high  value  of  the  land  he  seeks  to 
cultivate,  would  seem  to  indicate  that  farm  tenancy 
will  increase  rather  than  farm  ownership.  In  this 
connection  let  us  look  at  the  figures  presented  by 
the  Board  of  Agriculture  on  the  operation  of  small 
holdings  in  England  and  Wales. 

Of  the  198,288  acres  acquired  by  the  Board  of 
Agriculture  from  1908  to  1914  inclusive,  no  less  than 
178,911  acres  were  leased  to  12,584  individual  small 
holders.  This  gives  an  average  size  for  each  hold- 
ing rented  to  tenants  of  a  little  more  than  14  acres. 

Of  the  total  acreage  acquired,  only  506  acres  were 
sold  to  50  small  holders,  being  an  average  of  slightly 
more  than  10  acres  to  a  holding.  Both  the  number 
of  new  landowners  and  the  size  of  their  farms,  there- 
fore, were  small  compared  with  the  total  acreage  and 
number  of  applicants  for  holdings. 

The  balance  of  the  land  acquired  by  the  Board  of 
Agriculture  for  small  holdings  was  leased  to  indi- 
viduals or  cooperative  societies.  Thus,  the  councils 
of  county  boroughs  leased  1,259  acres  to  218  indi- 
vidual tenants,  an  average  of  5.8  acres  to  a  holding; 


Analysis  of  the  British  System  75 

and  8,436  acres  were  leased  to  63  cooperative  small 
holdings  associations  which  sub-leased  the  land  to 
1,451  of  their  members,  the  average  size  of  the  hold- 
ing in  these  cases  being  5.8  acres  also.  Private  land- 
owners leased  directly  to  3,580  applicants  47,500 
acres,  or  an  average  farm  of  13  1-3  acres.  The  land 
acquired  by  the  board  at  Bournemouth  is  leased  to 
16  individual  tenants  and  one  small  holding  society, 
the  latter  leasing  75  acres  which  are  sub-leased  to  62 
tenants.  It  appears,  therefore,  that  the  act  has  re- 
sulted in  providing  small  gardens  or  farms  to  18,486 
applicants  in  seven  years.  But  of  this  number  less 
than  2  per  cent  express  a  desire  to  purchase  land  for 
agricultural  purposes.  More  than  98  per  cent,  there- 
fore, of  those  who  occupied  land  under  the  Small 
Holdings  and  Allotments  Act  did  so  as  tenants  and 
not  as  landowners.  In  1914  about  one-third  of 
those  applying  for  land  were  farm  laborers  who 
desired  to  increase  their  income  by  renting  a  parcel 
of  land  for  this  purpose. 

The  annual  report  on  small  holdings  for  1914 
makes  the  following  comments  on  their  size,  opera- 
tion and  condition: 

"The  average  size  of  the  holdings  provided  is  13 
acres  in  England  and  30  acres  in  Wales,  the  higher 
average  in  Wales  being  due  to  the  poorer  quality 
of  the  soil.  A  large  number  of  the  tenants  are  not 
solely  dependent  for  their  livelihood  on  the  holdings 
provided  under  the  act,  as  many  of  them  hold  in 


76  The  Place  of  'Agriculture  in  Reconstruction 

addition  other  land  from  private  landowners  and 
others  are  engaged  for  part  of  their  time  in  different 
occupations.  There  are,  however,  many  cases  in 
the  market-gardening  and  fruit-growing  districts  of 
tenants  who  obtain  their  whole  livelihood  from  hold- 
ings of  about  five  acres,  and  the  board  has  recently 
been  informed  of  one  case  in  Kent  where  the  tenant 
has  been  able  to  obtain  a  livelihood  for  himself,  his 
wife,  and  three  children  on  a  holding  of  only  two 
acres.  .  .  . 

' l  The  number  of  tenants  who  gave  up  their  hold- 
ings at  their  own  request  in  1914  were  253  in  England 
and  13  in  Wales,  and  in  many  cases  the  reason  was 
that  they  had  prospered  sufficiently  to  enable  them 
to  take  larger  holdings.  Councils  gave  notice  to  quit 
to  86  tenants  in  England  and  2  in  Wales,  which 
indicates  that  the  number  of  tenants  who  proved  un- 
satisfactory was  less  than  1  per  cent.  The  board 
instructed  their  small  holdings  commissioners  to  in- 
spect a  number  of  the  schemes  which  had  been  estab- 
lished sufficiently  long  to  judge  whether  they  are  suc- 
cessful, and  the  reports  on  67  schemes  that  have  been 
received  and  tabulated  show  that  out  of  a  total  of  428 
holdings,  the  condition  of  the  holdings  in  339  cases 
is  good,  in  55  cases  it  is  fair,  and  in  34  cases  it  is 
bad.  The  great  majority  of  the  schemes  are  working 
satisfactorily  and  the  land  has  been  improved  sub- 
stantially since  its  acquisition  by  the  councils.  Those 
few  schemes  which  are  not  so  satisfactory  mostly 


Analysis  of  the  British  System  77 

relate  to  land  bought  in  the  early  days  of  the  act 
before  councils  had  acquired  much  experience,  with 
the  result  either  that  the  land  has  proved  unsuitable 
for  small  holdings,  or  that  the  rents  are  too  high, 
or  that  the  equipment  provided  is  faulty. ' ' 

This  statement  shows  that  the  small  holdings 
movement  in  England  and  Wales  before  the  war 
was  generally  successful  whether  the  occupier  was 
owner  or  tenant.  This  was  undoubtedly  largely  due 
to  the  fact  that  the  applicants  were  carefully  selected 
as  to  their  adaptability  for  the  line  of  farm  or  gar- 
den work  chosen,  were  given  free  expert  advice,  and 
were  encouraged  to  cooperate  in  the  purchase  of  sup- 
plies and  the  marketing  of  produce.  Moreover,  suc- 
cess was  attained  on  small  holdings  when  a  great 
majority  of  the  occupants  had  formerly  lived  in 
towns  and  cities,  and  were  largely  unfamiliar  with 
farming  and  gardening  practises  when  they  took  up 
land  for  a  living.  The  facts,  therefore,  point  clearly 
to  the  conclusion  that  disabled  or  discharged  soldiers 
and  sailors  should  have  no  difficulty  in  making  a 
living  on  small  holdings  if  the  land  can  be  provided, 
if  they  are  selected  as  to  their  adaptability  for  a 
particular  line  of  farm  work,  if  they  receive  expert 
advice,  and  if  they  are  properly  and  adequately 
financed. 

In  the  case  of  the  few  small  holdings  which  were 
not  so  satisfactory,  the  causes  of  lack  of  success 
were  unsuitable  land,  too  high  rents,  and  improper 


78  The  Place  of  Agriculture  in  Reconstruction 

equipment.  The  former  is  a  defect  which  should  be 
carefully  considered  in  any  land-settlement  scheme. 
It  would  be  folly  of  the  worst  kind  to  permit  a  settler 
in  any  country  to  occupy  and  plant  land  to  crops 
for  which  the  soil  was  partly  or  altogether  unfit  for 
the  purpose.  The  best  and  most  efficient  farm  laborer 
in  the  world  could  not  succeed  in  farming  or  gar- 
dening under  such  conditions.  If  he  had  a  limited 
amount  of  capital,  which  is  more  than  likely  to  be 
the  case  with  a  disabled  and  discharged  ex-service 
man,  he  could  not  expect  to  make  his  living  from 
poor  land  while  attempting  its  improvement;  so 
that  the  adaptability  of  the  land  for  the  type  of 
agriculture  contemplated  is  of  prime  importance  in 
any  land  settlement  scheme  for  demobilized  soldiers 
and  sailors. 

The  questions  of  rent  and  of  proper  equipment 
were  the  other  factors  which  had  a  bearing  on  the 
lack  of  success  of  a  few  small  holdings  in  England 
and  Wales.  The  average  rent  of  the  land  leased  by 
the  county  councils  in  1914  for  small  holding  pur- 
poses was  £1  5s.  6d.  an  acre.  This  is  practically 
equivalent  to  an  average  rent  of  $6.12  an  acre — 
not  a  high  rent  for  some  land  if  favored  with  good 
fertility,  transportation  facilities,  and  nearby  mar- 
kets, but  quite  high  if  the  land  does  not  have  these 
advantages. 

Insufficient  or  improper  equipment  for  gardening 
or  farming  would  greatly  handicap  any  small  holder 


Analysis  of  the  British  System  79 

and  reduce  the  prospects  of  success  to  the  minimum. 
This  feature,  however,  is  a  question  of  capital  in- 
vestment and  will  be  considered  in  connection  with 
the  problem  of  financing  ex-service  men. 

The  outbreak  of  the  war  had  a  serious  effect  on  the 
farm-labor  problem  in  Great  Britain.  Thousands 
were  called  from  the  farms  to  take  up  arms,  with 
the  result  that  the  depletion  of  farm  labor,  which 
was  at  first  temporary,  has  become  permanent 
through  enormous  losses  of  men  on  the  battle  fields 
of  Europe.  Their  places  have  only  been  partly 
filled  by  prisoners  and  women.  In  1918  the  whole- 
time  and  part-time  women  workers  on  the  land  num- 
bered about  300,000,  to  whom  must  be  added  more 
than  11,000  women  of  "the  land  army."  These  are 
women  who  agreed  to  work  on  the  land  and  to  go 
wherever  they  were  sent.  They  are  recruited  from 
all  classes  of  women  in  Great  Britain  and  the  motive 
force  is  that  of  patriotism.  They  receive  a  month's 
training  to  get  their  muscles  into  condition.  Then 
they  are  sent  out  on  farms,  where  they  have  to 
make  sacrifices  and  endure  privations  which  to 
some  extent  are  comparable  to  those  of  their  friends 
and  relations  at  the  front. 

Speaking  in  the  House  of  Commons  on  July  18, 
1918,  on  the  value  of  the  different  kinds  of  farm 
labor  utilized  in  the  place  of  those  lost  by  the  war, 
Hon.  E.  E.  Prothero  said  that,  no  matter  what  the 
training,  the  loss  in  the  quality  of  farm  labor  could 


80  The  Place  of  Agriculture  in  Reconstruction 

not  be  made  good.  "Nothing  can  replace  to  the 
farmer,"  he  said,  "the  man  who  knows  the  land  on 
which  he  has  worked  all  his  life  probably,  and 
who  knows  not  only  what  he  has  got  to  do,  but  how 
he  has  got  to  do  it.  ...  The  new  labor  was,  for 
the  most  part,  unskilled  and  inexperienced,  and  it 
is  quite  obvious  that  dealing  with  labor  of  that  kind 
increases  expenses  very  largely.  Less  work  is  done, 
and  the  work  that  is  done  is  less  efficiently  done." 

These  statements  by  one  who,  as  chairman  of  the 
Board  of  Agriculture,  knows  the  farm-labor  situa- 
tion in  Great  Britain  thoroughly,  show  plainly 
enough  that  a  certain  course  of  training  should  be 
given  to  demobilized  soldiers  and  sailors  in  order 
to  fit  them  for  successful  farming  or  gardening 
operations.  This  will  be  especially  the  case  with 
men  who  have  had  little  or  no  experience  on  the 
land.  The  success  of  land  settlement  after  demo- 
bilization will  depend  in  no  small  degree  upon  the 
provision  made  for  the  efficient  training  of  men  for 
their  new  occupation  as  farmers  or  gardeners. 

This  fact  has  been  clearly  recognized.  The  re- 
port of  the  committee  of  the  Ministry  of  Beconstruc- 
tion  on  the  employment  on  the  land  of  returned  sol- 
diers and  sailors  states  among  other  things  "that 
men  without  practical  experience  should  be  encour- 
aged in  the  first  instance  to  work  as  wage  earners;" 
and  that  intending  small  holders  "who  cannot  be 
accommodated  in  a  small-holding  colony  should  work 


Analysis  of  the  British  System  81 

as  laborers  on  some  well-managed  small  holding  or 
suitable  farm."1 

Financing  Land  Settlement  Schemes 

The  last  point  to  be  considered  is  the  subject  of 
finance.  From  a  strictly  business  point  of  view,  land 
settlement  schemes  ought  to  be  self-support- 
ing. The  program  of  the  British  Labor  Party  for 
settling  soldiers  and  sailors  on  the  land  practically 
disregards  the  financial  part  of  the  problem  of  land 
settlement  altogether.  This  is  a  fatal  error  in  view 
of  the  enormous  debt  now  hanging  over  the  British 
people  and  the  high  values  which  prevail  for  land 
adapted  for  successful  small  holdings.  Instead  of 
being  disregarded,  the  subject  of  financing  land  set- 
tlement schemes  should  be  given  the  most  careful 
consideration. 

Fortunately  the  experience  of  the  British  govern- 
ment, both  before  and  during  the  war,  proves  that 
land  can  be  purchased  or  leased,  can  be  sold  or  rented 
to  applicants,  and  can  be  operated  at  little  or  no 
cost  to  the  taxpayers.  It  is  this  aspect  of  the  prob- 
lem which  renders  a  scheme  of  land  settlement  for 
the  demobilized  forces  of  Great  Britain  so  full  of 
promise  of  success.  Let  us  consider  what  was  the 
cost  of  acquiring  and  operating  small  holdings  be- 
fore the  war  and  the  cost  of  increasing  food  pro- 

*The  Journal  of  the  Board  of  Agriculture,  Feb.,  1919,  p.  1347. 


82  The  Place  of  Agriculture  in  Reconstruction 

duction  during  the  war  in  illustration  of  successful 
financial  methods  of  land  settlement. 

During  the  seven  years  preceding  the  war  in 
which  the  Small  Holdings  and  Allotments  Act  was  in 
operation,  the  total  amount  authorized  to  be  ex- 
pended was  £5,255,553,  of  which  £4,343,694  was  for 
the  purchase  of  land  and  £911,859  was  for  equip- 
ment and  adaptation.  This  sum,  representing  an 
expenditure  of  about  $25,542,000,  is  all  capital  in- 
vestment, the  value  of  which  exists  in  the  land  and 
equipment. 

Some  land  was  sold  but  most  of  it  was  leased  to 
tenants,  there  being  in  all  18,486  settlers  on  small 
holdings.  Under  the  act  the  Board  of  Agriculture  is 
authorized  to  pay  one-half  the  losses  incurred  by 
county  councils  in  carrying  out  individual  or  co- 
operative land  settlement  schemes.  Under  this  pro- 
vision of  the  act,  $3,635  was  the  sum  paid  as  losses 
for  the  seven  years  ending  December  31,  1914,  or 
an  average  of  about.  $520  a  year.  It  is  interesting  to 
note,  however,  that  most  of  this  loss  was  incurred 
because  of  a  thunderstorm  and  cloudburst  in  1909, 
which  damaged  the  crops  and  lands  of  the  tenants, 
and  also  because  the  rent  had  to  be  remitted  in  be- 
half of  the  tenants  on  small  holdings  in  Norfolk 
county  in  consequence  of  disastrous  floods,  which  oc- 
curred there  during  the  summer  of  1912.  The  forces 
of  nature,  therefore,  over  which  farmers  have  little 
or  no  control,  were  the  causes  of  these  small  losses 


Analysis  of  the  British  System  83 

and  not  any  defect  in  the  plan  of  financing  the  sys- 
tem of  land  settlement  authorized  under  the  Small 
Holdings  and  Allotments  Act. 

With  the  outbreak  of  unrestricted  warfare  on 
shipping,  the  question  of  the  food  supply  of  Great 
Britain  became  uppermost.  As  a  result  of  civil  and 
governmental  agitation,  a  large  area  of  grass  land, 
totaling  more  than  2,142,000  acres  largely  in  small 
holdings,  was  turned  into  arable  land  for  the  pro- 
duction of  cereal  and  root  crops  used  for  human 
food.  On  account  of  the  shortage  of  labor,  the  gov- 
ernment resorted  to  the  purchase  of  farm  machinery 
and  practised  every  means  of  financing  agriculture 
in  order  to  increase  the  food  supply  of  the  nation. 
The  result  was  a  large  outlay  of  capital  investment 
under  the  Food  Production  Department  in  the  form 
of  horse-drawn  farm  implements,  threshing  appa- 
ratus, tractors,  seeds,  fertilizers,  and  the  establish- 
ment of  a  seed-testing  station.  At  the  end  of  the 
financial  year  1918,  the  government  had  3,000  trac- 
tors at  work,  some  owned  and  some  hired,  and  dur- 
ing that  season  the  tractors  and  steam-tackle  im- 
plements together  plowed  about  1,611,000  acres  of 
land. 

In  reporting  to  the  House  of  Commons  on  the  cost 
of  these  unusual  efforts  in  the  cultivation  of  the  land, 
the  chairman  of  the  Board  of  Agriculture  said: 

"The  total  expenditure  under  all  those  heads  is 
£3,133,003.  Out  of  this  we  expect  to  recover  £1,452,- 


84  The  Place  of  Agriculture  in  Reconstruction 

940,  leaving  an  expenditure — and  you  must  remem- 
ber that  a  great  part  of  this  is  capital  expenditure 
— of  £1,680,063.  Of  the  recoverable  amount,  we  have 
already,  up  to  31st  March,  1918,  recovered  £602,985. 
Therefore,  the  expenditure  which  may  be  charged 
against  the  Food  Production  Department  is  £1,680,- 
063.  A  great  part  of  that,  something  like  £1,200,000, 
is  capital  expenditure,  and  if  you  spread  it  over  a 
period  of  four  years  obviously  it  becomes  a  much 
smaller  sum.  That  is  the  amount  which  has  been 
spent  and  how  it  has  been  spent."1 

This  outlay  for  farm  equipment,  however,  is  plain- 
ly an  investment  the  returns  from  which  cannot  be 
limited  to  a  single  season  but  rather  for  many  sea- 
sons. While  the  outlay  at  first  is  large  and  made 
in  a  short  space  of  time,  the  amount  recoverable  as 
rent  from  farmers  for  the  use  of  tractors  and  other 
labor-saving  farm  equipment  will  be  spread  over 
many  years  and  may  be  expected  even  to  return  a 
profit  on  the  investment.  Where  soldiers  and  sailors, 
therefore,  take  up  small  holdings  of  good  land  and 
the  government  sees  to  it  that  such  holdings  are 
properly  equipped  for  the  type  of  gardening  or 
agriculture  contemplated  by  the  settler,  there  is  no 
reason  why  they  should  not  become  a  complete  suc- 
cess. Evidently,  then,  the  problem  of  land  settle- 
ment by  ex-service  men,  in  addition  to  a  considera- 
tion of  the  adaptability  and  training  of  applicants 

'Journal  of  the  Board  of  Agriculture,  Aug.,  1918,  pp.  538,  539. 


Analysis  of  the  British  System  85 

for  the  work,  requires  for  its  successful  solution  the 
right  kind  of  land,  modern  equipment,  and  sufficient 
capital. 

Two  questions  finally  now  press  for  answer.  First, 
What  is  the  likelihood  that  disabled  and  demobilized 
men  will  have  sufficient  capital  to  take  up  some  line 
of  agricultural  work  and  make  of  it  a  complete  suc- 
cess? And,  secondly,  if  any  of  the  applicants  do  not 
have  sufficient  capital  to  properly  equip  and  operate 
their  farms,  has  the  British  government  proposed 
any  remedy  to  meet  such  a  serious  situation? 

As  pointed  out  in  the  preceding  chapter,  the  Small 
Holdings  Colonies  Act  of  1916  had  for  its  object 
the  settling  of  disabled  or  discharged  soldiers  and 
sailors  on  the  land.  On  the  very  important  sub- 
ject of  furnishing  capital  to  applicants,  the  annual 
report  of  the  operations  of  this  act  for  the  year 
1917  makes  this  statement: 

"Inquiries  are  frequently  made  by  applicants  as 
to  whether  advances  of  capital  are  made  by  the  state 
to  enable  them  to  take  up  holdings  under  the  scheme. 
But  the  board  have  no  power  to  make  advances 
for  the  purpose,  and  the  suggestion  was  expressly 
negatived  by  the  departmental  committee  on  land 
settlement  for  soldiers  and  sailors,  who  found  them- 
selves unable  to  recommend  such  a  proposal,  to  which 
they  felt  there  were  serious  objections. 

"It  is  satisfactory,  however,  to  note  that  a  con- 
siderable number  of  applicants  possess  a  certain 


86  The  Place  of  Agriculture  in  "Reconstruction 

amount  of  capital,  which  in  some  cases  may  be  re- 
garded as  being  adequate.  Out  of  178  cases  dealt 
with  by  the  board  it  was  found  that  while  54  ap- 
plicants possessed  capital  of  not  more  than  £50,* 
42  had  from  £50  to  £100,  26  from  £100  to  £200, 
13  from  £200  to  £400,  while  43  (or  less  than  one- 
fourth)  possessed  practically  no  capital  at  all." 

The  question  of  the  amount  of  capital  applicants 
possess,  therefore,  is  one  of  vital  importance  to  the 
success  of  any  land  settlement  scheme.  The  num- 
ber of  applicants  in  Great  Britain  before  the  close 
of  the  war,  taken  in  connection  with  the  limited  area 
of  land  open  to  lease  and  purchase  for  the  purpose 
of  land  settlement,  shows  how  intense  will  be  the 
problem  of  providing  for  the  employment  of  ex- 
service  men  when  they  return  for  demobilization  by 
the  million.  The  two  economic  factors  of  wealth 
production  from  the  land,  in  its  relation  to  the  em- 
ployment of  discharged  soldiers  and  sailors,  are  to 
provide  the  land  and  the  capital.  The  labor  element 
it  is  recognized  will  be  abundant.  The  problem  there 
is  to  provide  land  and  capital,  and  the  foregoing 
analysis  shows  that,  to  the  close  of  the  year  1918,  no 
adequate  attempt  had  been  made  to  solve  the  financial 
feature  of  the  problem.  It  remains  to-day  the  great 
economic  enigma  of  demobilization  in  Great  Britain. 

*For  easy  comparison  with  the  money  unit  of  the  United  States, 
$5  may  be  regarded  as  practically  equivalent  to  £1  sterling,  £50  being 
about  equal  to  $250. 


CHAPTER  V.— ENCOURAGEMENT  OF  LAND 
SETTLEMENT  IN  FRANCE 

It  has  been  previously  stated  that  post-war  prob- 
lems in  France  will  consist  largely  in  the  reconstruc- 
tion and  rehabilitation  of  the  northeastern  part  of 
the  country,  which  has  been  so  terribly  devastated 
by  the  German  invaders.  The  land  is  there,  but 
much  of  it  has  been  shell-torn  and  rendered  tem- 
porarily unfit  for  cultivation  until  it  shall  be  trans- 
formed or  even  reconstructed.  In  many  instances 
the  buildings  on  farms  have  been  badly  damaged  or 
totally  destroyed.  Some  of  the  owners  of  these 
farms  have  been  killed  or  seriously  wounded ;  others 
have  been  driven  away  and,  on  their  return  with 
little  or  no  capital,  will  find  their  farms  ruined.  All 
these  features  and  many  others  render  the  problem 
of  land  settlement  by  discharged  soldiers  and  sailors 
and  civilian  victims  of  the  war  by  no  means  easy  of 
solution. 

France  a  Land  of  Small  Farms 

With  the  customary  foresight  which  has  character- 
ized the  French  government  for  many  years,  plans 
have  been  laid  for  meeting  this  rural  situation  after 

87 


68  The  Place  of  Agriculture  in  Reconstruction 

demobilization.  So  far  as  the  settlement  of  soldiers 
on  the  land  is  concerned,  the  problem  is  simple. 
France  is  a  country  of  small  farms.  Her  people  long 
ago  yielded  to  the  feeling  of  "land  hunger "  and 
became  owners  of  small  holdings.  To  become  the 
owner  of  a  building  lot,  a  home  in  a  town  or  city,  or 
a  small  farm  in  the  country  has  been  the  undying 
ambition  of  millions  of  French  people.  This  sense' 
of  ownership  is  the  tie  which  built  up  a  self-reliant 
agricultural  population  in  France  and  made  of  her 
a  practically  self-supporting  nation  notwithstand- 
ing her  large  population  and  limited  extent  of  terri- 
tory. 

With  the  outbreak  of  the  war,  these  tillers  of  the 
soil  left  their  farms  to  take  up  arms  in  defense  of 
home  and  country.  Many  of  them  have  paid  the 
supreme  sacrifice  and  now  sleep  beneath  the  soil  they 
once  loved  to  cultivate.  Others  have  returned  dis- 
abled and  are  only  partly  able  to  work  the  land  as 
formerly.  With  demobilization  accomplished  hun- 
dreds of  thousands  of  others  will  return  to  the 
farms  they  left  to  take  up  again  the  work  of  culti- 
vating the  soil.  There  is  little  or  no  land  problem 
there.  Eather,  in  view  of  the  great  losses  in  men 
suffered  by  France  during  more  than  four  years  of 
war,  the  problem  is  one  of  men  to  occupy  the  land 
already  laid  out  in  small  farms  dotted  all  over  the 
country.  In  this  war  60  per  cent  of  the  French 
army  came  from  the  land. 


Encouragement  of  Land  Settlement        89 

By  the  act  of  July  12,  1909,  France  established  a 
homestead  law  which  followed  closely  the  Texas 
homestead  law  of  1839.  The  object  of  this  law  was 
to  protect  the  workman  in  town  and  cities  and  the 
rural  small  holder  from  having  his  home  seized  for 
debt.  In  either  case  it  limited  the  value  of  the 
homestead  that  could  not  be  seized  to  $1600. 

By  the  act  of  March  19,  1910,  France  came  to  the 
rescue  primarily  of  those  farmers  whose  holdings 
had  been  destroyed  by  the  terrible  inundations  of 
January  of  that  year.  But  the  law  itself  added  an- 
other link  to  the  chain  of  rural  credit  which  had 
been  gradually  constructed  by  the  French  govern- 
ment in  behalf  of  agriculture.  This  law  established 
long-time  individual  farm  mortgage  credit  at  a  low 
rate  of  interest  and  on  the  amortization  plan  of  re- 
payment. The  law  of  December  29,  1906,  provided 
long-time  collective  credit  to  the  district  rural  credit 
banks,  of  which  there  was  at  least  one  to  be  estab- 
lished in  each  department  of  France.  From  the 
standpoint  of  area,  a  "department"  or  "district" 
corresponds  to  a  county  of  a  state.  The  district 
banks  were  granted  government  loans  without  in- 
terest for  the  encouragement  of  agriculture.  In- 
dividual long-time  loans  were  made  by  the  district 
banks  to  members  of  local  rural  credit  societies  at 
a  low  rate  of  interest,  usually  at  2  per  cent,  for  the 
purpose  of  aiding  farmers  or  others  to  purchase,  im- 
prove, transform,  or  reconstruct  their  small  rural 


90  The  Place  of  Agriculture  in  Reconstruction 

holdings.  The  maximum  loan  permissible  under  this 
law  was  also  for  $1600. 

The  object  of  all  these  laws  and  many  others  was 
to  encourage  the  younger  generations  of  French 
farmers  and  farm  laborers  to  remain  on  the  land. 
Under  a  system  of  enforced  military  service,  young 
men,  called  to  the  colors,  would  fail  to  return  to  farm 
life  after  their  period  of  service  was  over.  Long- 
time individual  mortgage  credit  was  designed  to 
cHeck  this  tendency  and  to  encourage  the  develop- 
ment of  a  class  of  independent  small  farm  owners. 
The  result  was  that,  at  the  outbreak  of  the  great 
European  war  in  1914,  France  had  become  a  nation 
of  small  farm  owners  and  thousands  of  ex-soldiers 
readily  left  their  farms  to  take  up  arms  in  defense 
of  their  country.  This,  in  brief,  is  the  land  and 
labor  situation  which  confronts  French  agriculture 
with  the  advent  of  peace  and  demobilization. 

For  a  period  of  more  than  eight  years,  therefore, 
before  the  close  of  the  great  war,  the  farmers  of 
France  had  been  able  to  procure  long-time  mortgage 
loans  at  about  2  per  cent  interest.  In  1913  there 
were  100  departmental  or  district  banks  and  more 
than  4,000  local  rural  credit  societies  affiliated  with 
them.  Any  member  of  one  of  these  local  societies 
could  reap  the  benefits  of  this  system  of  long-time 
loans,  and  these  benefits  had  consequently  been  ex- 
tended through  these  local  units  from  one  end  of 
France  to  the  other. 


Encouragement  of  Land  Settlement        91 

With  the  vast  problems  connected  with  devasta- 
tion of  a  large  part  of  northeastern  France,  with 
thousands  of  civilians  rained  by  the  war,  with  large 
numbers  of  injured  soldiers  unprepared  to  take  their 
places  as  economic  units  in  the  work  of  productive 
gardening  and  agriculture,  and  with  the  demobiliza- 
tion of  millions  of  soldiers  confronting  the  nation 
on  the  return  of  peace,  the  French  parliament  took 
up  the  question  of  reconstruction  and  government 
aid  in  behalf  of  agriculture.  In  view  of  the  condi- 
tions outlined  above  pertaining  to  farm  mortgage 
loans,  it  would  seem  to  American  farmers,  accus- 
tomed as  they  are  to  rates  of  interest  ranging  from 
5  to  12  per  cent  a  year,  that  the  task  of  framing  a 
more  liberal  law  in  behalf  of  soldiers,  sailors,  and 
civilian  victims  of  the  great  European  war  would  be 
a  most  difficult  one  for  the  French  national  legis- 
lature to  accomplish.  In  order  to  show  that  the 
problems  have  been  duly  considered  and  the  task 
satisfactorily  performed,  the  text  of  the  new  French 
law  is  given  pertaining  to  government  aid  for  the 
purchase  and  improvement  of  rural  small  holdings 
by  military  and  civilian  victims  of  the  war. 

The  Law  of  April  9,  1918 

Article  1.  Land  credit  societies  and  rural  credit 
societies  are  hereby  authorized,  under  the  conditions 
provided  respectively  by  the  laws  of  April  10,  1908, 
and  of  March  19,  1910,  to  make  mortgage  loans : 


92  The  Place  of  Agriculture  in  Reconstruction 

(1)  To  discharged  soldiers  and  sailors  who  are 
recipients  of  state  pensions  for  injuries  received  or 
infirmities  contracted  during  the  present  war. 

(2)  To  widows  who  are  recipients  of  pensions  or 
life  annuities  payable  by  the  government  or  by  the 
Savings  Bank  for  French  Sailors  because  of  the 
death  of  their  husbands  from  injuries  received  or 
diseases  contracted  since  August  2,  1914. 

(3)  To  those  having  the  right  of  life  annuities  or 
pensions  payable  by  the  government  or  by  the  Sav- 
ings Bank  for  French  Sailors  because  of  bodily  in- 
juries received  by  said  persons  through  the  war, 
provided  they  now  are  or  may  be  inscribed  on  the 
list  of  insured  persons  under  the  law  of  April  5, 
1910,  for  workingmen's  or  peasants'  pensions  by 
their  conforming  to  the  requirements  of  said  law. 

Said  individual  mortgage  loans  shall  be  made  for 
the  purpose  of  facilitating  the  purchase,  improve- 
ment, transformation  and  reconstruction  of  rural 
small  holdings  the  value  of  which,  excluding  the  costs 
and  the  insurance  premium,  shall  not  exceed  10,000 
francs  ($2000)  no  matter  what  its  area  may  be;  the 
period  of  the  repayment  of  said  loans  shall  not  be 
more  than  25  years,  nor  shall  the  age  of  the  bor- 
rower exceed  60  years  at  the  time  of  the  payment 
of  the  last  instalment. 

Article  2.  Loans  made  by  land  credit  societies 
and  rural  credit  societies  to  the  beneficiaries  named 
in  article  1  shall  be  granted  at  1  per  cent  interest. 


Encouragement  of  Land  Settlement        93 

Each  borrower  shall  be  required,  at  the  time  of 
receiving  his  mortgage  loan,  to  take  out  a  policy 
with  the  National  Insurance  Society,  which  shall 
guaranty  in  case  of  his  death  the  payment  of  the  re- 
maining instalments  on  his  debt ;  the  amount  of  the 
existing  premium,  together  with  the  costs  of  mak- 
ing the  loan,  may  be  added  to  the  amount  of  the 
mortgage. 

The  borrower  shall  also  be  required  to  furnish  a 
certificate  provided  by  paragraph  3  of  article  3  of  the 
law  of  April  10,  1908,  showing  that  the  residence  on 
said  small  holding  had  been  inspected  by  a  repre- 
sentative of  the  committee  of  sanitation  and  social 
welfare,  which  is  appointed  in  each  rural  district  for 
this  purpose,  and  also  that  the  residence  had  been 
inspected  as  provided  by  said  paragraph  by  another 
representative  chosen  from  among  the  members  of 
either  agricultural  associations  for  manufactured 
products,  agricultural  societies,  rural  cooperative 
production  societies,  mutual  rural  credit  banks, 
mutual  rural  insurance  societies,  or  county  com- 
mittees on  injuries. 

1  Article  3.  The  beneficiaries  named  in  article  1  of 
the  present  law,  who  shall  purchase  a  house  or  a 
building  lot  under  the  conditions  provided  by  the 
laws  of  April  12,  1906,  April  10,  1908,  February  11, 
1914,  and  subsequent  laws  pertaining  to  the  same 
subject,  or  who  shall  purchase,  improve,  transform, 
or  reconstruct  a  rural  small  holding  under  the  con.- 


94  The  Place  of  Agriculture  in  Reconstruction 

ditions  provided  by  the  present  law,  shall  be  exempt 
from  the  requirement  that  he  shall  have  at  least 
one-fifth  the  price  of  the  house  or  land  or  small 
holding. 

In  case  of  default  in  the  payment  of  an  instal- 
ment, the  society  which  made  the  loan  shall  have  the 
privilege  of  levying  one-fifth  of  that  instalment 
against  the  payments  on  the  debtor's  pensions,  but 
on  the  condition  that  this  charge  shall  not  absorb 
more  than  half  of  any  pension  payment  nor  reduce 
it  to  a  sum  less  than  360  francs  ($72),  the  part  of 
his  pension  which  cannot  be  levied  upon.  This 
clause  shall  be  inserted  in  the  mortgage  and  shall 
become  a  conditional  charge. 

In  order  to  procure  this  payment,  the  society 
which  made  the  loan  shall  send  a  written  demand  to 
the  debtor  in  default  to  make  payment.  At  the  ex- 
piration of  15  days,  it  shall  in  the  same  manner 
make  demand  upon  the  Treasury  for  said  payment 
in  arrears. 

If  the  debtor,  as  regards  that  part  of  his  pension 
which  can  be  levied  upon,  does  not  choose  to  oppose 
the  claim,  the  Treasury  will  be  at  liberty  to  trans- 
mit to  the  society  the  amount  of  the  pension  that  is 
claimed. 

If  the  pensioner,  however,  formulates  an  answer, 
a  justice  of  the  peace,  on  being  asked  by  the  Treas- 
ury, shall  bring  together  the  representative  of  the 
society  and  the  debtor.  From  his  decision,  which 


Encouragement  of  Land  Settlement        95 

shall  be  rendered  without  delay,  there  shall  be  no 
appeal. 

Payment  of  the  amount  annually  levied  shall  be 
by  quarterly  instalments. 

Article  4.  Land  credit  societies,  as  well  as  rural 
credit  societies,  shall  have  power  to  receive,  without 
being  limited  to  double  their  subscribed  capital,  for 
the  exclusive  use  of  loans  granted  under  the  present 
law,  special  advances  without  interest  from  the  gen- 
eral agricultural  credit  fund  for  making  individual 
long-time  loans  provided  by  the  law  of  March  19, 
1910. 

These  advances  shall  be  repayable  by  annual  in- 
stalments within  a  maximum  period  of  26  years. 

Article  5.  The  advances  provided  for  by  the  pre- 
ceding article,  in  consideration  of  the  security  of- 
fered by  the  societies  and  the  needs  which  they  ap- 
pear to  satisfy,  shall  be  granted : 

(1)  By  the  Secretary  of  Agriculture  to  the  rural 
credit  societies. 

(2)  By  the  Secretary  of  Labor  and  Secretary 
of  Agriculture  jointly  to  the  land  credit  societies. 

These  advances  shall  be  made  under  the  super- 
vision of  a  special  commission  of  which  the  Secre- 
tary of  Agriculture  shall  be  president  and  the  Secre- 
tary of  Labor  and  Social  Welfare,  vice-president. 
(The  remainder  of  the  commission  consists  of  10 
other  named  persons  who  are  prominent  in  banking 
and  financial  matters,  insurance,  agricultural  co- 


96  The  Place  of  Agriculture  in  Reconstruction 

operation,  mutual  insurance,  and  rural  credits,  who 
are  officially  connected  with  the  government,  making 
a  total  of  12  members  on  this  commission.) 

The  members  of  this  commission,  with  the  excep- 
tion of  those  who  serve  by  right  of  office,  shall  hold 
office  for  a  period  of  four  years. 

Article  6.  The  sum  of  one-half  franc  (10  cents) 
for  every  100  francs  ($20)  borrowed  shall  be  set 
aside  annually  by  the  government,  in  diminution  of 
the  instalment  payable  to  the  lending  society  by 
the  borrower,  for  every  legitimate  child  that  shall 
be  born  to  him  after  the  loan  is  closed. 

These  additional  sums  shall  be  paid  directly  by 
the  government  into  the  treasury  of  the  lending  so- 
ciety to  the  credit  of  the  borrower. 

Article  7.  By  way  of  modifying  the  requirements 
of  the  law  of  July  12,  1909,  the  rural  holdings  pur- 
chased, improved,  transformed  or  reconstructed 
under  the  conditions  of  the  present  law  or  by  virtue 
of  the  law  of  March  19, 1910,  shall  be  deemed  a  home- 
stead not  liable  to  seizure,  but  without  interfering 
with  the  right  of  the  lending  societies  of  procuring 
a  judgment  by  suit  against  the  land  and  of  proceed- 
ing to  execute  such  judgment  in  case  of  need.  Lend- 
ing societies  will  enjoy  the  privileges  provided  by 
article  2103,  section  2,  of  the  Civil  Code. 

The  beneficiaries  named  in  article  1  above,  the 
unmarried  and  those  without  children,  shall  be  able 
in  like  manner,  by  modification  of  the  law  of  July 


Encouragement  of  Land  Settlement        97 

12,  1909,  to  establish  for  their  benefit  as  an  un- 
seizable  homestead  the  land  acquired,  improved, 
transformed  or  reconstructed  by  them  in  conse- 
quence of  the  present  law  on  the  condition  that  they 
enter  into  marriage  within  a  period  of  three  years 
from  the  time  of  acquiring  the  homestead.  After 
this  period  and  in  default  of  this  condition,  any 
interested  party  shall  have  power  to  seek  the  re- 
peal of  the  said  statute. 

As  regards  the  question  of  long-time  loans  for 
those  still  in  the  army  and  navy,  which  are  granted 
by  a  district  agricultural  credit  bank  under  the  terms 
of  the  law  of  March  19,  1910,  the  provision  of  said 
law  which  limits  advances  to  double  the  capital  of 
these  banks  shall  not  be  applicable,  but  the  total  of 
such  loans  may  be  made  up  to  four  times  their 
capital. 

Article  8.  Deeds  for  lands  acquired  to  the  maxi- 
mum value  of  1,200  francs  ($240),  which  they  shall 
engage  to  cultivate  themselves  for  a  period  of  ten 
years,  deeds  made  within  a  year  following  their  de- 
mobilization by  farmers,  tenants,  farm  laborers  and 
those  who  are  not  yet  landowners,  shall  be  exempted 
from  the  customary  charges  and  shall  be  registered 
without  cost. 

Article  9.  Within  three  months  from  the  promul- 
gation of  the  present  law,  a  regulation  pertaining  to 
its  public  administration  shall  determine  the  condi- 


98  The  Place  of  Agriculture  in  Reconstruction 

tions  for  carrying  it  out  and  the  measures  for  fi- 
nancing the  operations  provided  therein. 

It  will  be  noted  that  the  benefits  of  the  new  law 
are  confined  to  "military  pensioners  and  civilian 
victims  of  the  war/'  whether  they  live  in  towns  or 
in  the  rural  districts.  This  would  seem  to  indicate 
plainly  that  the  French  parliament  foresaw  that 
there  would  be  no  difficulty  in  absorbing  all  the  rural 
labor  forces  that  would  be  released  from  the  army 
and  navy  when  demobilization  should  occur.  The 
probability  is  that  the  great  majority  of  discharged 
soldiers  and  sailors  will  return  to  their  native  homes 
and  take  up  anew  their  various  lines  of  gardening, 
vineyarding,  and  farming  they  were  doing  before 
the  war  and  which  is  characteristic  of  agriculture  in 
France.  The  rural  labor  problem,  therefore,  will 
probably  give  the  government  little  or  no  concern 
unless  it  be  from  the  financial  point  of  view.  But 
with  a  customary  rate  of  interest  about  2  per  cent 
a  year,  and  a  special  rate  provided  of  1  per  cent  a 
year  under  the  present  law  for  military  pensioners 
and  civilians  who  have  suffered  bodily  injuries,  the 
financial  problem  also  seems  to  have  reached  a  satis- 
factory solution. 

The  Decree  of  July  19, 1918 

The  last  article  of  the  new  law  provides  that  a  de- 
cree shall  be  issued  within  three  months  from  the 


Encouragement  of  Land  Settlement        99 

time  of  the  law's  promulgation,  which  should  regu- 
late its  public  and  financial  administration.  By  vir- 
tue of  this  provision,  a  decree  was  drawn  up  by  the 
government  council,  consisting  of  the  secretaries  of 
Agriculture,  Labor,  and  the  Treasury,  presented  to 
President  Poincare,  and  signed  by  him  on  July  9, 
1918. 

In  their  letter  of  transmittal  to  the  president  at- 
tention is  called  to  the  special  features  of  the  new 
law,  namely,  that  loans  are  to  be  made  on  the 
amortization  plan  of  repayment,  for  periods  of  time 
not  to  exceed  25  years,  and  at  1  per  cent  interest. 
For  the  encouragement  of  larger  families  among  the 
rural  population,  the  government  is  to  pay  a  subsidy 
of  $1.00  a  year  for  every  $200  borrowed,  to  be  ap- 
plied on  the  instalments  annually  payable  by  the 
borrower,  for  every  legitimate  child  born  to  him 
after  the  loan  is  made.  The  securities  required  for 
these  loans  are  a  mortgage  on  the  home  or  small 
rural  holding  and  a  life  insurance  policy  issued  by 
the  National  Insurance  Society,  a  government  in- 
stitution, made  payable  to  the  rural  credit  society 
which  made  the  loan  in  case  of  the  death  of  the 
borrower. 

In  approving  the  provisions  of  the  new  law,  the 
decree  laid  down  the  terms  and  conditions  under 
which  loans  should  be  made  to  military  pensioners 
and  civilian  victims  of  the  war  by  the  rural  credit 
societies,  how  the  government  would  make  loans  to 


100     The  Place  of  Agriculture  in  Reconstruction 

the  departmental  rural  credit  banks  and  to  land 
credit  societies,  and  various  other  dispositions  af- 
fecting the  execution  of  the  new  law.  These  regula- 
tions are  important  for  carrying  out  a  program  of 
land  settlement  and  rural  reconstruction  in  France. 

1.  The  conditions  of  locms.  Article  1.  Eural 
credit  societies  and  land  credit  societies  which  de- 
sire to  make  loans  as  provided  by  article  1  of  the 
law  of  April  9,  1918,  should  be  prepared  to  do  so 
by  amending  their  statutes. 

Article  2.  The  conditions  under  which  loans  may 
be  granted  and  repaid  are  determined  for  each  of 
the  societies  interested  by  special  regulations  issued 
and  approved  by  the  Secretary  of  Agriculture  for 
rural  credit  societies  and  jointly  by  the  secretaries 
of  Labor  and  Agriculture  for  the  land  credit  so- 
cieties. 

No  request  for  a  loan  should  be  considered  unless 
it  is  accompanied:  (1)  By  a  written  agreement  on 
the  part  of  the  borrower  that  he  will  himself  operate 
the  farm  which  is  mortgage^  as  security  for  the 
loan;  and  (2)  by  a  certificate  from  the  National  In- 
surance Society  stating  that  the  applicant,  after 
medical  examination,  had  been  accepted  by  said  so- 
ciety as  one  who  could  fulfil  the  conditions  of  insur- 
ance provided  by  the  decree  of  October  17, 1912,  and 
have  his  life  insured  as  provided  by  article  2  of  the 
present  law. 


Encouragement  of  Land  Settlement 

Article  3.  The  life  insurance  policy  required  by 
article  2  of  the  law  must  be  made  payable  to  the 
lending  society  in  case  of  the  death  of  the  borrower. 

Article  4.  If  deemed  necessary,  the  rural  credit 
societies  and  land  credit  societies  may  require  of 
their  borrowers,  besides  the  obligatory  securities 
provided  by  the  law  of  April  9,  1918,  certain  supple- 
mentary securities,  the  nature  of  which  shall  be  de- 
termined by  special  regulations  approved  by  the  de- 
partmental secretary  having  jurisdiction  as  is  pro- 
vided by  article  2  above. 

Article  5.  The  costs  of  executing  a  mortgage  and 
life  insurance  policy,  as  well  as  the  costs  of  pro- 
curing the  loan,  may  be  added  to  the  amount  of  the 
loan,  even  if  the  loan  itself  is  the  maximum  of 
$2,000. 

Article  6.  When  loans  are  made  for  certain  work 
pertaining  to  the  improvement  and  transformation 
of  a  farm,  sums  may  be  advanced  only  in  propor- 
tion as  the  work  progresses  or  the  implements  and 
materials  are  delivered,  and  then  only  on  the  produc- 
tion of  receipts. 

Article  7.  The  conditions  of  repaying  a  loan  by 
amortization  are  to  be  established  by  rural  credit 
societies  and  land  credit  societies  after  taking  into 
consideration  the  possible  productivity  of  the  farm, 
and  may  be  such  that,  during  the  first  three  years, 
this  amortization  may  be  computed  in  unequal  in- 
stalments or  the  payment  of  the  first  instalment 


102;.  The  Place  of  Agriculture  in  Reconstruction 

under  exceptional  circumstances  may  be  deferred  to 
the  end  of  the  third  year  from  the  time  the  loan  was 
made.  After  that  time  the  repayment  shall  always 
be  in  equal  annual  instalments,  but  in  no  case  shall 
the  period  of  a  loan  exceed  25  years. 

Loans  may  be  repaid  by  means  of  annual,  semi- 
annual or  quarterly  instalments. 

Article  8.  In  cases  where  the  conditions  relating 
to  loans,  such  as  those  provided  by  the  special  regu- 
lations laid  down  in  articles  2  and  4  above,  are  not 
carried  out  by  the  borrower,  the  amount  loaned  shall 
immediately  become  repayable  except  that,  under 
exceptional  circumstances  which  are  beyond  the  bor- 
rower's control,  each  case  shall  be  reviewed  by  the 
departmental  secretary  having  jurisdiction  and  be 
approved  by  the  commission  provided  by  article 
5  of  the  law. 

Article  9.  Before  January  15th  of  each  year,  the 
rural  credit  societies  shall  submit  to  the  Secretary 
of  Agriculture  and  the  land  credit  societies  to  the 
Secretary  of  Labor,  a  statement  showing:  (1)  The 
number  and  amount  of  the  subsidies  which  are  due 
to  their  borrowers  for  the  year  last  past  to  be  used 
in  diminishing  the  instalments  on  their  loans  by 
reason  of  each  legitimate  child  born  after  the  loan 
was  made,  as  is  provided  by  the  law  of  April  9, 1918 ; 
and  (2)  the  date  and  amount  of  the  loans  granted 
to  those  borrowers  with  a  table  of  instalments  to  be 


Encouragement  of  Land  Settlement      103 

paid.  They  shall  also  furnish  with  each  one  of  their 
requests  a  birth  certificate  for  each  child. 

The  subsidies  are  paid  directly  to  the  societies 
making  the  loans  by  the  departmental  secretaries 
having  jurisdiction,  as  indicated  in  the  present  arti- 
cle, out  of  special  appropriations  provided  for  this 
purpose  and  charged  against  the  budgets  of  the  re- 
spective secretaries. 

Article  10.  Eural  credit  societies  and  land  credit 
societies  must  have  it  specified  in  the  mortgage  that 
they  reserve  the  right  to  foreclose  on  the  property 
under  the  privileges  granted  by  section  2  of  article 
2103  of  the  Civil  Code,  even  if  the  farm  purchased, 
improved,  transformed  or  reconstructed  has  been 
constituted  an  unseizable  homestead. 

2.  Advances  of  Government  Funds.  Article  11. 
The  district  agricultural  cooperative  credit  banks 
and  the  land  credit  societies  which  may  wish  to  ob- 
tain a  special  advance  of  funds  as  provided  by  the 
law  of  April  9, 1918,  must  attach  to  their  request  the 
following  documents : 

(1)  Two  copies  of  their  statutes  and  of  the  spe- 
cial regulations  pertaining  to  the  use  of  loans,  which 
have  been  approved  by  the  departmental  secretary 
having  jurisdiction  in  the  matter. 

(2)  A  list  of  the  members  of  the  council  of  ad- 
ministration and  of  the  committee  of  supervision, 
with  their  business  and  place  of  residence. 


104     The  Place  of  Agriculture  in  Reconstruction 

(3)  The  last  statement  showing  the  financial  con- 
dition and  the  report  of  the  committee  of  supervi- 
sion, together  with  a  copy  of  the  proceedings  of  the 
general'assembly  which  approved  the  financial  state- 
ment. 

(4)  A  detailed  statement  showing  the  financial 
condition  of  the  society  on  the  day  the  request  was 
made. 

(5)  An  account  of  the  loans  which  the  society 
proposes  to  grant  with  the  government  funds  re- 
quested. 

(6)  An  extract  from  the  proceedings  of  the  meet- 
ing of  the  council  of  administration  showing  that  it 
voted  to  request  a  special  advance  of  funds  from 
the  Secretary  of  Agriculture  within  the  limits  fixed 
by  the  statutes  and  by  the  general  assembly. 

The  council  of  administration  can  also  forward 
any  other  documentary  evidence  which  it  may  deem 
necessary. 

The  banks  and  societies  already  provided  with  an 
advance  of  government  funds,  if  they  request  new 
loans,  need  not  submit  copies  of  their  statutes  when 
they  have  not  been  changed  since  the  preceding  ad- 
vance of  funds,  but  they  should  add  to  the  list  of 
documents  mentioned  above  a  statement  of  the  loans 
made  in  conformity  to  the  law  of  April  9,  1918,  from 
the  beginning  to  the  date  of  the  new  request. 

Article  12.  The  district  agricultural  cooperative 
credit  banks  should  transmit  their  requests  directly 


Encouragement  of  Land  Settlement      105 

to  the  Secretary  of  Agriculture ;  the  land  credit  so- 
cieties should  send  their  requests  for  funds  to  the 
Secretary  of  Labor,  who  will  forward  them  to  the 
Secretary  of  Agriculture. 

Article  13.  The  requests  for  government  funds 
coming  from  the  district  agricultural  cooperative 
credit  banks  and  land  credit  societies  should  be  sub- 
mitted for  approval  to  the  general  council  of  inspec- 
tion of  credit  and  subsidized  agricultural  associa- 
tions. 

The  inspectors  to  whom  the  requests  for  govern- 
ment loans  are  submitted  should  be  aided  with  the 
advice  of  the  special  commission  provided  by  article 
5  of  the  law. 

Article  14.  Before  the  end  of  January  of  each 
year  the  district  agricultural  cooperative  credit 
banks  and  land  credit  societies  should  transmit  to  the 
government  the  total  amount  of  instalments  payable 
under  article  4  of  the  law  of  April  9, 1918,  the  same 
being  determined  in  such  a  way  as  to  assure  the 
repayment  of  the  government  funds  within  a  period 
not  exceeding  26  years. 

In  order  to  fix  the  amount  of  the  annual  instal- 
ments, consideration  should  be  given  to  the  period 
of  postponement  which  is  granted  to  certain  bor- 
rowers by  article  7  of  the  law  as  to  their  non-pay- 
ment of  instalments  during  the  first  three  years  of 
their  loan.  But  even  when  this  is  taken  into  con- 


106     The  Place  of  Agriculture  in  Reconstruction 

sideration,  the  period  of  repayment  cannot  exceed 
a  maximum  of  26  years. 

The  special  loans  of  government  funds  to  the  dis- 
trict agricultural  cooperative  credit  banks  and  land 
credit  societies  shall  become  immediately  repayable : 
(1)  In  case  of  the  violation  of  their  statutes  and  of 
the  special  regulations  provided  by  articles  2  and  4 
above;  (2)  in  case  of  amendment  to  the  statutes 
which  decreases  the  guaranties  of  repayment;  (3)  in 
case  the  funds  are  used  for  other  purposes  than 
those  stated;  and  (4)  on  default  in  the  payment  of 
instalments  for  a  period  of  one  year. 

Article  15.  Supervision  over  the  transactions 
provided  by  article  9  of  the  law  of  April  9,  1918,  is 
exercised  by  the  inspector-general  of  credit  and 
subsidized  agricultural  associations.  His  duties  are 
to  examine  into  the  financial  and  business  adminis- 
tration of  the  agricultural  cooperative  credit  so- 
cieties and  land  credit  societies  which  have  borrowed 
government  funds  under  the  provision  of  the  law 
of  April  9,  1918,  and  to  establish  correct  directions 
for  carrying  out  legislative,  administrative  and 
statutory  regulations. 

In  the  case  of  land  credit  societies  the  examination 
into  their  financial  condition  by  the  bank  examiners 
should  not  be  concerned  with  any  accounts  except 
those  provided  by  the  law  of  April  9,  1918,  and  that 
only  to  the  extent  necessary  for  supervising  the  last- 
named  transactions,  which  ought  to  be  a  special  ac- 


Encouragement  of  Land  Settlement      107 

count  opened  in  the  general  ledger  of  each  society. 
These  special  accounts  ought  to  be  kept  in  conform- 
ity with  the  instructions  given  by  the  departmental 
secretary  having  jurisdiction  on  the  recommendation 
of  the  inspector-general. 

Examiners  can  require  the  production  of  all  docu- 
ments corresponding  to  the  accounts.  The  reports 
on  the  condition  of  land  credit  societies  are  to  be 
transmitted  to  the  Secretary  of  Labor. 

Article  16.  District  agricultural  cooperative  cred- 
it banks  and  land  credit  societies,  which  request 
a  government  loan,  are  required  to  furnish  to  the 
Secretary  of  Agriculture  and  the  Secretary  of  Labor, 
respectively,  the  following  documents:  (1)  Within 
the  first  eight  days  of  each  quarter  a  statement  from 
the  general  ledger  showing  the  financial  condition; 
(2)  within  the  second  part  of  February  a  review  of 
the  business  transacted  during  the  preceding  year, 
the  balances,  and  a  statement  of  profits  and  losses ; 
and  (3)  within  fifteen  days  following  the  meeting 
of  the  general  assembly  of  the  society,  a  verbatim 
report  of  the  proceedings  of  that  meeting. 

3.  Various  regulations.  Article  17.  District  agri- 
cultural cooperative  credit  banks,  in  carrying  out  the 
provisions  of  paragraph  3  of  article  7  of  the  law  of 
April  9, 1918,  may  request  a  government  loan  in  ex- 
cess of  more  than  twice  their  subscribed  capital  but 
not  to  exceed  four  times  said  capital,  for  the  pur- 


108     The  Place  of  Agriculture  in  Reconstruction 

pose  of  making  individual  long-time  loans  to  sol- 
diers still  in  the  army  under  the  provisions  of  the 
law  of  March  19,  1910,  but  should  accompany  their 
request  with  a  list  of  their  soldier  members  who  de- 
sire long-time  loans  and  a  statement  of  the  amount 
of  loans  they  expect  to  make  and  have  already  made. 
These  requests  are  considered  by  the  allotment  di- 
vision established  by  article  5  of  the  law  of  Decem- 
ber 29, 1906. 

Article  18.  The  secretaries  of  Agriculture,  of  the 
Treasury,  and  of  Labor,  each  in  the  matter  which 
concerns  them,  are  authorized  to  put  into  effect  the 
present  decree,  which  shall  be  inserted  in  the  Bulletin 
on  Laws  and  published  in  the  Official  Journal  of  the 
French  Eepublic. 

Limitations  of  the  Land  Settlement  Law 

The  French  law  of  April  9,  1918,  and  the  decree 
concerning  it  have  established  a  system  for  en- 
couraging land  settlement  by  soldiers,  sailors  and 
civilians.  It  provides  for  long-time  mortgage  loans 
on  homes  in  towns  and  on  small  farms  for  periods 
of  time  not  exceeding  25  years  on  the  amortization 
plan  of  repayment,  and  at  1  per  cent  interest  a  year. 
The  central  feature  of  the  proposed  French  system 
of  land  settlement,  therefore,  pertains  to  the  fur- 
nishing of  capital  rather  than  to  providing  land  for 
ex-service  men  and  others  who  have  been  injured  as 
a  result  of  the  war.  The  progress  made  in  land 


Encouragement  of  Land  Settlement      109 

mortgage  credit  and  land  settlement  policy  has  been 
clearly  summarized  by  Hon.  Victor  Boret,  Secretary 
of  Agriculture,  who  states  that  the  interest  which 
prevailed  from  a  national  point  of  view  to  retain  or 
to  establish  soldiers  on  the  land,  whether  they  come 
from  the  country  or  not  and  who  had  been  away  from 
their  homes  for  several  years,  was  the  subject  of 
particular  attention  both  on  the  part  of  Parliament 
and  the  Department  of  Agriculture. 

Although  legislation  previous  to  the  great  war  per- 
mitted farmers  to  borrow  money  up  to  $1600  at  2 
per  cent  interest,  repayable  in  15  years,  for  the  pur- 
chase, equipment,  improvement,  and  reconstruction 
of  rural  small  holdings,  it  seemed  necessary  to  make 
larger  provision  in  behalf  of  those  who  had  espe- 
cially suffered  from  the  war. 

In  France,  however,  the  important  question  was 
not  that  of  making  allotments  of  land  as  is  pro- 
posed in  the  United  States.  There  being  little  or 
no  free  public  land  for  settlement  purposes,  gov- 
ernment aid  was  susceptible  of  application  largely 
in  the  form  of  financial  aid  and  that  only  in  propor- 
tion to  the  object  to  be  attained  with  the  limited  re- 
sources at  the  disposition  of  the  Treasury.  This 
last  consideration,  therefore,  did  not  permit  the 
granting  of  financial  aid  indiscriminately  to  all  sol- 
diers and  sailors  who  had  been  through  the  war, 
but  rather  forced  the  government  to  the  policy  of 
limiting  loans  to  actual  victims  of  the  war,  namely, 


110     The  Place  of  'Agriculture  in  Reconstruction 

to  those  soldiers,  sailors  and  civilians  who  were  pen- 
sioners. 

The  task  now  before  us  is  to  explain  more  in  detail 
how  the  law  of  April  9,  1918,  is  intended  to  improve 
the  economic  condition  of  farmers  in  France,  to  in- 
crease the  rural  population,  and  to  build  up  a  bet- 
ter system  of  social  economy  in  rural  communities. 


CHAPTER  VI.— ANALYSIS  OF  THE  FRENCH 
SYSTEM  OF  FINANCING  LAND  SETTLE- 
MENT 

Under  date  of  July  31,  1918,  the  secretaries  of 
Agriculture  and  of  Labor  jointly  issued  a  pamphlet 
of  instructions  concerning  the  law  of  April  9,  1918. 
As  previously  stated,  this  law  relates  to  the  pur- 
chase and  improvement  of  rural  small  holdings  by 
military  pensioners  and  civilian  victims  of  the  war. 
The  purpose  of  these  instructions  was  to  put  into 
practise  more  easily,  by  means  of  explanatory  re- 
marks, the  provisions  of  the  law  which,  it  is  scarcely 
necessary  to  emphasize,  are  of  the  very  highest  so- 
cial importance. 

The  law  under  consideration  had  its  origin  in 
various  propositions  and  suggestions  offered  by  sev- 
eral deputies  and  senators.  The  bill,  after  being  in- 
troduced in  the  Chamber  of  Deputies  by  Mr.  Bon- 
nevay  and  in  the  Senate  by  Mr.  Strauss,  received 
the  unanimous  support  of  the  French  Parliament. 
In  the  language  of  the  report  of  Mr.  Strauss,  the 
purpose  of  the  act  is  "the  exceptional  one  of  ex- 
tending and  developing  rural  small  holdings  for  the 
benefit  of  the  heroic  victims  of  the  great  war." 

ill 


112     The  Place  of  Agriculture  in  Reconstruction 

To  this  end,  the  law  authorizes  land  credit  so- 
cieties and  rural  credit  societies  to  make  long-time 
individual  mortgage  loans  to  the  various  benefi- 
ciaries named  in  article  1,  for  the  purpose  of  facili- 
tating the  purchase,  improvement,  transformation 
and  reconstruction  of  rural  small  holdings,  the 
amount  of  a  loan,  excluding  the  costs  and  the  insur- 
ance premium,  not  to  exceed  $2,000  no  matter  how 
large  or  how  small  the  farm  may  be. 

These  loans  are  made  by  the  land  credit  and  rural 
credit  societies  at  a  reduced  rate  of  interest  by 
means  of  funds  advanced  by  the  government  to  these 
societies  without  interest.  Let  us,  then,  examine 
successively  the  conditions  of  making  (1)  loans  to 
borrowers,  and  (2)  advances  of  government  funds 
to  the  societies. 

The  Conditions  of  Loans 

1.  The  beneficiaries  of  these  mortgage  loans  are : 
(1)  Former  soldiers  and  sailors  who  are  recipients 
of  invalid  pensions  paid  by  the  government  for  in- 
juries received  or  infirmities  contracted  during  the 
course  of  the  war;  (2)  the  wives  of  those  who  were 
the  recipients  of  life-time  pensions  or  indemnities, 
paid  by  the  government  or  by  the  Savings  Bank  for 
French  Sailors,  by  reason  of  the  death  of  their  hus- 
bands from  injuries  received  or  diseases  contracted 
during  the  war;  and  (3)  those  who  have  a  right  to 
these  life-time  indemnities  or  pensions  paid  as  above 


Analysis  of  the  French  System          113 

indicated  by  reason  of  bodily  injuries  sustained  by 
these  persons  as  a  result  of  the  war. 

Briefly,  then,  only  the  recipients  of  life-time  pen- 
sions or  indemnities  can  receive  these  farm  mort- 
gage loans.  It  necessarily  excludes  the  recipients 
of  temporary  relief  because  they  could  not  offer  the 
security  and  guaranties  required  of  borrowers  by 
paragraph  3  of  article  2  of  the  law  of  April  9,  1918. 

2.  Object,  amount  and  period  of  loans.  Article 
1  of  the  law  expresses  the  object  of  loans  to  be  "to 
facilitate  the  purchase,  improvement,  transforma- 
tion and  reconstruction  of  rural  small  holdings. " 
This  is  a  reproduction  of  the  exact  language  of  arti- 
cle 1  of  the  law  of  March  19,  1910.  No  particular 
explanation  is  needed  on  this  provision.  However, 
it  may  be  advisable  to  call  attention  to  what  may  be 
included  under  the  term  "improvement." 

Speaking  before  the  Senate  as  a  representative  of 
the  National  Federation  of  Mutual  Insurance  and 
Agricultural  Cooperation,  Mr.  Viger,  former  Secre- 
tary of  Agriculture,  very  justly  remarked  that  it 
was  not  only  advisable  to  provide  for  the  purchase 
of  a  farm,  but  to  make  such  farms  more  profitable 
by  the  purchase  of  necessary  equipment  and  sup- 
plies. It  would  be  extremely  regrettable,  he  said, 
to  allow  victims  of  the  war  to  invest  all  their  loans 
in  the  purchase  of  land  only  to  find  themselves  with- 


114     The  Place  of  Agriculture  in  Reconstruction 

out  money  for  the  purchase  of  necessary  livestock 
and  agricultural  implements. 

Now,  the  purchase  of  necessary  equipment  and 
supplies  can  be  included  in  the  operation  of  rural 
small  holdings  under  the  term  "improvement";  and 
it  has  been  thus  clearly  denned  by  article  6  of  the 
rules  issued  for  the  public  administration  of  the  act. 
Loans,  then,  can  be  made  not  only  for  the  price  of 
farms  purchased  by  the  beneficiaries  of  the  law,  but 
also  for  the  purchase  of  necessary  equipment  and 
supplies  in  order  to  put  the  farms  in  a  condition  of 
productivity. 

Let  us  consider  next  the  amount  and  period  of 
loans.  The  law  of  March  19,  1910,  does  not  permit 
rural  credit  societies  to  make  loans  in  excess  of 
$1,600. 

On  the  other  hand,  the  law  of  April  10,  1908,  as 
explained  in  the  report  presented  by  Mr.  Bonnevay 
to  the  Chamber  of  Deputies  on  July  28,  1916,  fixed 
the  limit  of  land  to  2%  acres  and  the  value  of  the 
fields  and  gardens  to  $240,  which  could  be  acquired  by 
means  of  loans  made  by  the  land  credit  societies. 
Moreover,  the  law  of  February  11,  1914,  authorized 
these  societies  to  make  loans  to  small  farm  owners 
who  wished  to  add  to  their  premises  a  stable,  cow- 
barn,  or  any  other  building  of  similar  character. 
These  supplementary  loans  could  not  exceed  the  sum 
of  $400.  This  legislation  was  altogether  too  re- 
stricted to  promote  rural  welfare ;  it  did  not  provide 


Analysis  of  the  French  System          115 

for  the  purchase  of  a  farm  large  enough  to  enable 
the  owner  to  make  a  living  therefrom  for  himself 
and  family. 

But  by  article  1  of  the  new  law  loans  can  be  made 
up  to  $2000,  exclusive  of  the  costs  and  the  insurance 
premium.  Moreover,  a  noticeable  difference  between 
the  new  law  and  that  of  April  10,  1908,  is  that  the 
former  does  not  limit  the  land  area  of  the  farm. 

The  period  for  repaying  a  loan  under  the  new 
law  cannot  exceed  25  years.  This  is  the  customary 
period  required  for  the  repayment  of  loans  to  land 
credit  societies.  On  the  other  hand,  the  law  of 
March  19,  1910,  limited  the  period  of  repayment  of 
loans  to  rural  credit  societies  to  15  years.  But  the 
last  paragraph  of  article  1  of  the  law  of  April  9, 
1918,  adds  this  condition  that  the  age  of  the  bor- 
rower, at  the  time  of  the  last  instalment  on  his  loan, 
shall  not  be  more  than  60  years.  The  rural  credit 
societies,  therefore,  can  make  loans  for  the  maximum 
period  of  25  years  to  borrowers  who,  at  the  time  of 
receiving  their  loans,  are  not  more  than  35  years  old. 
For  borrowers  older  than  this,  the  period  of  a  loan 
must  be  diminished ;  an  applicant  40  years  old  cannot 
borrow  for  more  than  20  years ;  one  of  45  years  of 
age  for  15  years,  and  so  on. 

3.  The  security  and  conditions  of  loans.  (1)  The 
fundamental  security  for  a  loan  is  a  registered  first 
mortgage  on  the  farm  on  which  the  loan  is  made. 


116     The  Place  of  Agriculture  in  Reconstruction 

Bural  credit  societies  are  required  in  making  loans 
under  the  new  law  to  follow  the  suggestions  of  the 
Secretary  of  Agriculture  in  his  notice  concerning 
the  application  of  the  law  of  March  19,  1910,  par- 
ticularly the  necessity,  if  the  borrower  is  married, 
of  having  the  wife  join  with  him  in  signing  the  mort- 
gage. That  is  to  say,  the  wife  is  expected  to  set 
aside  her  legal  rights,  which  is  a  first  claim  on  the 
property,  by  signing  the  mortgage  made  in  favor  of 
the  bank  or  the  society  granting  the  loan. 

(2)  An  additional  security  is  provided  by  article 
2  of  the  law.  In  order  to  guarantee  the  payment 
of  the  instalments  on  his  debt  in  case  of  his  prema- 
ture death,  the  borrower  has  to  take  out  a  life  in- 
surance policy  with  the  National  Insurance  Society, 
which  is  made  payable  to  the  society  making  the 
loan. 

In  conformity  with  article  2  of  the  regulations  for 
the  public  administration  of  the  law,  the  borrower 
must  present  with  his  application  for  a  loan  a  cer- 
tificate from  the  National  Insurance  Society,  stating 
that  after  a  medical  examination  he  has  been  ac- 
cepted by  the  said  society  as  one  able  to  procure 
such  a  life  insurance  policy  as  is  required  by  the  law. 

On  account  of  the  inexperience  of  most  borrowers, 
it  will  be  for  the  best  interest  of  all  concerned  to 
have  the  land  credit  societies  and  the  rural  credit 
societies  act  as  intermediaries  between  the  insured 
and  the  National  Insurance  Society  in  completing  the 


Analysis  of  the  French  System          117 

insurance  arrangements.  To  this  end  they  ought  to 
fill  out  for  each  of  their  prospective  borrowers  an 
insurance  form,  which  they  may  procure  from  the 
Trust  and  Deposit  Bank.  This  form  should  be 
dated  and  signed  by  the  applicant,  who  will  at  the 
same  time  fill  in  at  the  end  of  the  insurance  policy 
the  name  of  the  credit  society  from  which  he  is 
about  to  procure  a  loan. 

In  support  of  each  application,  the  societies  must 
furnish:  (a)  A  copy  of  the  birth  certificate  of  the 
borrower;  and  (b)  a  table  of  the  instalments  the  in- 
sured will  have  to  pay  in  case  the  loan  is  granted. 
The  copy  of  the  birth  certificate  can  be  replaced  by 
an  official  document,  such  as  a  family  or  military  rec- 
ord, for  the  purpose  of  substantiating  the  truthful- 
ness of  the  claims  set  forth  in  the  application. 

After  the  receipt  of  these  documents,  the  National 
Insurance  Society  invites  the  applicant  to  present 
himself  at  the  office  of  its  medical  examiner.  At 
the  conclusion  of  this  examination,  the  cost  of  which 
must  be  borne  by  the  applicant,  the  insurance  so- 
ciety informs  the  latter  whether  he  has  been  accepted 
or  rejected.  In  case  the  applicant  is  accepted,  the 
policy  of  insurance  should  be  written  within  three 
months  from  the  time  of  the  medical  examination. 
If  this  period  is  exceeded,  the  applicant  must  sub- 
mit to  a  new  examination. 

(3)  Article  3  of  the  law  provides,  among  other 
things,  that  the  lending  societies,  in  case  of  default 


118     The  Place  of  Agriculture  in  Reconstruction 

in  the  payment  of  instalments  on  loans,  may  levy 
npon  the  pension  of  the  debtor  to  the  extent  of  one- 
fifth  of  the  defaulted  instalment  providing  that  this 
levy  does  not  reduce  the  pension  to  less  than  $72  a 
year  nor  absorb  more  than  half  his  pension. 

The  new  law  adds  an  important  amendment  to 
the  law  of  April  10,  1908,  concerning  loans  made  by 
land  credit  societies.  The  benefits  of  the  law  of 
1908  could  not  be  enjoyed  by  those  who  had  little 
or  no  capital,  for  a  loan  could  not  be  granted  to  a 
borrower  unless  he  could  pay  down  one-fifth  the 
price  of  the  property  to  be  purchased.  Article  3  of 
the  said  law  provides  that  "each  of  the  class  of  bor- 
rowers designated  in  article  2  must  comply  with 
the  following  conditions:  At  the  time  of  procuring 
his  mortgage  loan  he  should  possess  at  least  one- 
fifth  the  price  of  the  land  or  of  the  house." 

Under  this  provision  no  loan  could  be  made  in  ex- 
cess of  four-fifths  the  sum  necessary  for  purposes  of 
purchase  or  construction.  Now,  as  stated  in  the 
remarks  by  Mr.  Bonnevay  on  discussing  the  law  of 
April  9,  1918,  in  the  Chamber  of  Deputies,  the  dis- 
abled soldier  returning  to  his  home  after  a  long 
campaign,  a  stay  more  or  less  prolonged  in  a  hos- 
pital or  convalescent  depot,  will  more  frequently 
have  exhausted  his  savings  and  cannot  possibly  own 
one-fifth  the  purchase  price  of  a  place,  a  condition 
necessary  to  render  one  eligible  for  a  loan  from  a 
land  credit  society.  So  article  3  of  the  new  law 


Analysis  of  the  French  System          119 

relieves  him  of  this  obligation  to  own  this  amount 
of  property.  The  whole  amount  up  to  $2000  neces- 
sary for  the  purchase,  improvement,  transformation 
or  reconstruction  of  a  rural  small  holding  can  be 
loaned  to  him. 

But  dispensing  with  the  requirement  of  one-fifth 
the  amount  of  the  property  increases  quite  consid- 
erably the  risk  to  the  society  making  the  loan.  So 
section  2  of  article  3  permits  the  society  to  find  a 
compensatory  security  in  the  pension  payments  of 
the  borrower.  The  mortgage  will  contain  a  provi- 
sional clause  to  the  effect  that,  in  case  of  default 
in  the  payment  of  an  instalment  on  a  loan,  the  pen- 
sion payments  may  be  levied  upon  to  the  amount  of 
one-fifth  of  the  sum  due.  In  order  to  levy  on  the 
pension,  a  special  method  of  procedure  has  been 
provided. 

(4)  According  to  article  2  of  the  decree  of  July 
14, 1918,  a  borrower  must  make  a  written  agreement 
to  cultivate  the  farm  himself  upon  which  the  mort- 
gage has  been  placed.  The  third  division  of  article 
1  of  the  law  of  April  10,  1908,  already  imposes  a 
similar  condition  on  one  who  borrows  of  a  land  credit 
society  in  order  to  purchase  a  small  farm.  Mr. 
Viger,  former  Secretary  of  Agriculture,  set  forth  his 
views  on  this  subject  in  the  course  of  the  discussion 
which  preceded  the  vote  of  the  Senate  on  the  law  of 
April  9, 1918,  as  follows : 

"In  the  regulations  for  its  public  administration, " 


120     The  Place  of  Agriculture  in  Reconstruction 

he  said,  ' '  it  will  be  necessary,  I  think,  to  take  meas- 
ures so  that  the  owner  of  the  rural  small  holding, 
acquired  by  means  of  the  loan  which  will  be  made 
to  him  up  to  a  maximum  of  $2,000,  may  not  be  that 
kind  of  occupier  who  will  cultivate  his  farm  by  the 
labor  of  another,  who  will  rent  it  out,  and  who  from 
that  time  will  not  be,  as  we  would  wish  him  to  be, 
a  cultivator  of  the  land  by  means  of  the  loan  granted 
to  him." 

There  is  no  doubt,  however,  that  the  operation  of 
the  farm  by  the  borrower  himself  ought  to  be  under- 
stood in  the  largest  sense  of  the  term.  It  is  not 
necessary  to  require  borrowers  who  are  disabled  by 
the  war  that  they  themselves  should  actually  do  the 
work,  but  it  comes  within  the  condition  required  by 
article  2  of  the  regulations  for  its  public  adminis- 
tration that  the  work  on  the  farm  be  done  under  his 
direction.  In  fact,  article  8  of  said  regulations  even 
provides  that  under  certain  exceptional  circum- 
stances which  are  beyond  the  control  of  the  bor- 
rower,— for  example,  in  case  of  an  incurable  disease, 
— the  amount  loaned  need  not  be  immediately  repay- 
able if  the  agreement  made  by  the  party  interested 
that  he  himself  will  cultivate  the  farm  has  not  been 
literally  observed.  But  it  will  be  necessary  in  that 
case  that  the  society  making  the  loan  shall  report  the 
case  to  the  inspector-general  of  credit  and  subsidized 
agricultural  associations,  who,  in  turn,  will  inform 
the  Secretary  of  Agriculture;  and  it  will  also  be 


Analysis  of  the  French  System          121 

necessary  that  the  commission  provided  by  article 
5  of  the  law  should  render  a  favorable  opinion  and 
that  a  decision  conformable  thereto  be  made  by  the 
secretary  of  the  department  having  authority  in  the 
matter. 

(5)  Article  1  of  the  law  of  April  9,  1918,  places 
under  a  special  guaranty  loans  to  civilian  victims  of 
the  war ;  that  is  to  say,  to  those  who  have  the  right 
of  life-time  indemnities  or  pensions  paid  by  the  gov- 
ernment or  by  the  Savings  Bank  for  French  Sailors 
because  of  bodily  injuries  sustained  by  them  as  a  re- 
sult of  the  war.    The  special  guaranty  required  is 
that  civilian  war  victims  have  been  inscribed  or  may 
be  inscribed  under  the  law  of  April  5,  1910,  on  the 
list  of  insured  persons  for  workmen's  or  peasants' 
pensions  and  that  they  have  otherwise  conformed 
to  the  requirements  of  said  law.    By  this  provision, 
Parliament  has  intended  to  limit  the  benefits  of  the 
law,  at  least  in  so  far  as  it  concerns  civilian  war  vic- 
tims, to  those  who  have  given  or  may  give  evidence 
of  thrift.    At  the  same  time  Parliament  desired  to 
bring  the  text  of  the  new  law  in  accord  with  the  law 
of  April  11,  1914,  relative  to  the  advance  of  funds 
by  land  credit  societies  for  the  purchase  of  small 
holdings  and  with  article  36  of  the  law  concerning 
workmen's  and  peasants'  pensions. 

(6)  The  banks  and  societies  which  make  the  loans 
should  moreover  require  a  clause  in  the  mortgage 
to  the  effect  that  the  buildings,  equipment  and  sup- 


122     The  Place  of  Agriculture  in  Reconstruction 

plies  shall  always  be  insured  against  fire,  that  the 
live  stock  shall  be  insured  against  death,  and,  if  it 
is  deemed  advisable,  that  the  workmen  shall  be  in- 
sured against  accidents.  As  a  matter  of  preference 
these  agreements  regarding  insurance  should  be 
made  with  mutual  agricultural  insurance  societies. 

As  regards  fire  insurance,  the  mortgage  should 
provide  that,  in  case  of  loss,  the  insurance  should 
be  payable  to  the  bank  or  society  making  the  loan, 
and  notification  to  this  effect  should  be  given  to  the 
insurance  company  or  to  the  mutual  agricultural  fire 
insurance  society  which  insured  the  buildings. 

(7)  A  final  condition  is  required,  but  only  of  bor- 
rowers from  rural  credit  societies,  who  must  be 
members  of  a  local  rural  credit  society  and  of  an 
affiliated  agricultural  association  in  order  to  enjoy 
the  benefits  of  loans  under  the  law  of  April  9,  1918. 
If  they  are  not  members  when  they  apply  for  a 
loan  they  should  at  the  time  of  making  their  appli- 
cation also  make  a  written  request  to  be  admitted  to 
membership  in  a  local  rural  credit  society  and  an 
agricultural  association. 

But  in  certain  cases  the  banks  and  societies  mak- 
ing the  loans  may  decide  whether  or  not  the  various 
precautionary  measures  taken  are  sufficient.  Arti- 
cle 4  of  the  decree  of  July  19,  1918,  gives  them  au- 
thority to  require  of  their  borrowers  any  other  se- 
curity they  may  deem  advisable,  such  as  chattel 


Analysis  of  the  French  System          123 

mortgages,  notes,  warehouse  receipts,  and  agricul- 
tural warrants.  But  they  ought  in  such  cases  to 
enumerate  in  their  by-laws  the  various  supplemen- 
tary securities  required,  as  is  provided  by  article  2 
of  the  regulations  for  the  public  administration  of 
the  law. 

4.  Interest,  Amortizement,  and  Instalment.  Fol- 
lowing the  suggestion  of  Deputy  Gaston  Treignier, 
the  French  Parliament  fixed  the  rate  of  interest  on 
loans  at  1  per  cent.  But  the  debt  must  be  repaid 
during  the  period  of  the  loan,  so  that  the  amount 
of  the  debt  which  is  repaid  each  year  constitutes 
the  amortizement.  The  interest,  plus  the  annual 
payment  on  the  debt,  is  the  sum  the  borrower  has 
to  pay  each  year,  or  the  instalment. 

The  following  table  shows  the  annual  instalments 
which  must  be  paid  on  a  loan  of  $1,600  at  1  per  cent 
interest  for  periods  of  time  ranging  from  5  to  25 
years : 


Period  of 
Loan 
5  years  

Annual 
Instalment 
$329.66 

Period  of 
Loan 

Annual 
Instalment 
$108.71 

6     "     

276.08 

17    "     

102.81 

7    "     

237.81 

18    "     

9757 

8     "     

209.10 

19    "     

....       9288 

9     "     

18678 

20    "     

....       88  66 

10    "     

168  93 

21     "     ... 

84  85 

11     "     

155.33 

22    "     

81.38 

12    "     

142.16 

23     "     

78.22 

13     "     

131.86 

24    "     

75  32 

14    "     

123.04 

25    "     

72.65 

15    " 

115.40 

124     The  Place  of  Agriculture  in  Reconstruction 

If  a  borrower  should  procure  a  loan  of  $200  at  1 
per  cent  interest  for  a  period  of  5  years,  he  would 
repay  his  debt  with  interest  by  paying  annually 
$41.21 ;  if  his  loan  ran  for  10  years,  he  would  annually 
pay  $21.12;  and  if  his  loan  was  for  25  years,  his 
annual  instalment  would  be  $9.08  only.  For  a  loan 
of  $2,000,  the  annual  instalment  in  each  case  would 
be  ten  times  as  large.  It  is  easy,  then,  to  calculate 
the  annual  instalments  to  be  paid  on  various  loans 
granted  for  different  periods  of  time. 

The  banks  and  societies  which  make  the  loans 
ought  to  ascertain  in  advance  that  the  net  income 
likely  to  be  derived  from  the  farm  will  provide  for 
the  annual  instalments ;  and  they  ought  to  take  this 
factor  into  consideration  in  determining  the  period 
of  the  loan.  In  other  words,  in  order  that  the  bor- 
rower may  pay  off  his  debt  normally,  the  annual 
instalment  ought  not  to  exceed  the  net  income  from 
the  farm. 

Now,  let  us  take  in  illustration  the  case  of  a  dis- 
abled man  who,  counting  upon  his  pension  on  which 
to  live  during  the  period  of  the  loan,  borrows  the 
sum  of  $1,600  for  the  purpose  of  paying  for  a  farm 
which  he  wishes  to  cultivate.  Let  us  suppose  the  net 
income  of  that  farm  is  about  $100  a  year. 

If  he  is  to  repay  the  loan  during  a  period  of  25 
years,  his  annual  instalment  will  be  $72.65.  The 
net  income,  then,  of  $100  a  year  is  large  enough  to 
insure  the  payment  of  the  annual  instalment.  But, 


Analysis  of  the  French  System          125 

if  he  should  wish  to  borrow  for  a  period  of  10  years, 
the  annual  instalment  in  that  case  being  $168.93  as 
against  an  income  of  $100  only,  the  instalment  could 
not  possibly  be  paid.  Under  such  circumstances,  the 
period  of  the  loan  ought  to  be  at  least  18  years,  the 
annual  instalment  being  in  that  case  $97.57,  which  is 
nearly  equal  to  the  net  income. 


5.  Insurance  premium  and  costs  of  loan.  The 
following  tables  give  the  amounts  of  the  premium  of 
life  insurance  payable  for  a  loan  of  $200  which  runs 
for  15,  20  or  25  years. 


Period  of  Loan  15  Years 

Age  at  time  Premium  on 

of  contract  Loan  of  $200 

25  to  26  years $16.42 

30  to  31    "      16.83 

35  to  36     "      16.92 

40  to  41     "      19.26 

45  to  46     "      26.10 


Period  of  Loan  SO  Tears 
Age  at  time  Premium  on 

of  contract  Loan  of  $200 

25  to  26 

30  to  31 

35  to  36 

40  to  41 

45  to  46 


years $20.66 

11      21.31 

"      22.45 

"      26.58 

"  35.52 


Period  of  Loan  25  Years 

Age  at  time  Premium  on 

of  contract  Loan  of  $200 

25  to  26  years $24.66 

30  to  31  "  26.03 

35  to  36  "  28.40 

40  to  41  "  34.25 

45  to  46  "  45.85 

The  premium  of  life  insurance  and  the  costs  of 
procuring  a  loan  constitute  charges  heavy  enough 
for  borrowers  to  pay.  These  expenses  can  be  ad- 
vanced by  the  banks  or  societies  making  the  loans 
and  can  be  added  afterwards  to  the  amount  of  the 


126    The  Place  of  'Agriculture  in  Reconstruction 

loan,  even  if  it  has  been  granted  to  the  maximum  of 
$2,000.  The  annual  instalment  should  then  be  cal- 
culated on  the  total  amount  thus  advanced. 

At  this  point  it  is  necessary  to  call  special  atten- 
tion to  the  provision  of  article  8  of  the  law  of  April 
9, 1918,  which  only  indirectly  relates  to  the  real  pur- 
pose of  the  act.  By  this  provision  Parliament  wished 
to  encourage  a  return  to  farm  life  not  only  on  the 
part  of  those  disabled  in  the  war,  but  also  of  all 
farmers  in  the  army.  It  therefore  provided  that, 
if  the  farmers,  tenants  and  farm  laborers  who  had 
been  through  the  war  and  who  were  not  yet  land- 
owners, should  purchase  land  and  agree  to  cultivate 
it  themselves  for  a  period  of  10  years,  the  purchase 
deeds  on  said  land  to  the  maximum  of  $240  should 
be  exempt  from  taxation  and  be  registered  free 
of  charge  if  the  deeds  were  drawn  within  a  year 
after  the  purchasers  were  demobilized. 

6.  Payment  of  instalments.  The  payment  of  in- 
stalments on  loans  may  be  made  either  annually, 
semi-annually,  or  even  quarterly.  For  the  sake  of 
simplicity  annual  payments  are  to  be  preferred. 
The  choice  of  December  31  coincides  with  the  time 
when  farmers  generally  have  their  financial  obliga- 
tions to  meet  and  closes  their  crop  year,  so  it  is 
usually  selected.  In  certain  sections  where  the  finan- 
cial obligations  occur  at  different  times  of  the  year, 
one  can  provide  for  the  payment  of  instalments 


Analysis  of  the  French  System          127 

semi-annually,  that  is,  on  June  30  and  December 
31.  The  quarterly  payments  will  be  more  or  less 
exceptional;  for  example,  they  would  be  advisable 
in  market-garden  sections.  Under  all  circumstances 
it  would  be  advisable  for  the  banks  and  societies 
making  loans  to  provide  for  this  matter  in  their  by- 
laws and  take  into  consideration  the  kind  of  agri- 
culture carried  on  in  any  particular  district  and  the 
principal  times  of  year  when  the  income  is  greatest. 

For  each  loan  it  is  important  to  establish  in  ad- 
vance the  table  of  amortization  payments,  which  will 
represent  the  course  of  the  repayment  of  the  loan 
during  the  period  of  its  existence.  This  table  is  in- 
dispensable on  the  one  hand  in  order  to  insure  the 
regular  bookkeeping  of  the  societies,  and  on  the 
other  hand  to  make  the  borrowers  acquainted  with 
their  financial  obligations.  It  is,  therefore,  advisable 
to  forward  a  copy  of  the  amortization  table  to  each 
person  interested  and  to  require  him  to  sign  another 
copy  before  the  money  is  advanced.  It  is  also  equally 
important  to  send  a  copy  to  the  departmental  secre- 
tary having  jurisdiction.  This  table  will  be  sent  on 
his  request  to  the  inspector-general  of  credit  and 
subsidized  agricultural  associations  in  order  that  he 
may  exercise  his  control. 

The  following  example  indicates  how  an  amortiza- 
tion table  ought  to  be  arranged.  It  is  for  a  loan 
of  $1,000  for  10  years. 


128    The  Place  of  Agriculture  in  Reconstruction 


Amortisation  table  for  a  loan  of  $1,000  at  1  per  cent  interest, 

dating  from  January  1,  1919  Principal 

Applied  on     Still 
Time  of  Payment  Instalment  Interest   Principal     unpaid 


December 

31, 

1919  

$105  58 

$10  00 

$95  58 

$904  42 

December 

81, 

1920  

105.58 

904 

96  54 

807  88 

December 

si. 

1921  

105.58 

808 

97  50 

710  38 

December 

SI 

1922   

105.58 

710 

98  48 

61190 

December 

SI 

1923 

105  58 

6  12 

9946 

512  44 

December 

SI 

1924 

.    ..        10558 

5  12 

10046 

411  98 

December 

31 

1925 

105  58 

4  12 

10146 

310  52 

December 

31, 

1926  

105.58 

3.10 

102.48 

208.04 

December 

81, 

1927  

105.58 

2.08 

103.50 

104.54 

December 

SI, 

1928  

105.58 

1.04 

104.54 

Total    $1,055.80    $55.80    $1,000.00 

By  reference  to  the  above  table  it  is  seen  that,  in 
order  to  repay  a  loan  of  $1,000  in  10  years  at  1  per 
cent  interest,  it  is  necessary  to  pay  annually  $105.58. 

At  the  end  of  the  first  year,  the  interest  due  on  a 
loan  of  $1,000  at  1  per  cent  interest  is  $10.  The 
annual  instalment  to  be  paid  being  $105.58,  the  bor- 
rower then  has  amortized  his  loan  $105.58 — $10  = 
$95.58.  He  owes  then  only  $1,000  —  $95.58  = 
$904.42. 

At  the  end  of  the  second  year,  the  interest  at  1 
per  cent  is  calculated  on  the  principal  still  unpaid 
of  $904.42,  which  is  $9.04.  Since  the  instalment  is 
always  the  same,  namely,  $105.58,  the  borrower  then 
has  amortized  his  loan  in  the  second  year  $105.58  — 
$9.04  =  $96.54.  He  then  owes  only  $904.42  —  $96.54 
=  $807.88. 

At  the  end  of  the  third  year  the  borrower  pays 
interest  at  1  per  cent  on  $807.88,  which  is  $8.08.  In 


Analysis  of  the  French  System          129 

paying  his  instalment,  he  amortizes  $105.58  —  $8.08 
=  $97.50.  The  remaining  debt  is  then  $807.88  — 
$97.50  =  $710.38.  By  continuing  the  same  method  of 
calculation  for  succeeding  years,  the  amortization 
table  as  given  above  is  reached.  At  the  end  of 
the  tenth  year  there  is  no  debt  remaining  unpaid, 
and  the  total  of  amortizements  is  evidently  equal  to 
$1,000. 

7.  Postponement  of  the  first  instalment.  The 
first  years  on  a  farm  are  the  least  productive  for 
farmers,  and  it  is  frequently  only  after  quite  a  pe- 
riod of  time  that  a  farm  reaches  its  maximum  pro- 
ductivity. In  view  of  this  condition,  pensioners  and 
civilian  victims  of  the  war  will  be  likely  to  need  all 
their  resources  to  pay  off  their  first  instalments. 
Consequently,  article  7  of  the  decree  provides  that, 
during  the  first  three  years,  the  amortization  pay- 
ments can  be  calculated  in  instalments  of  unequal 
amount  or  in  exceptional  cases  the  payment  of  the 
first  instalment  can  be  postponed  until  the  fourth 
year  of  the  loan.  But  it  must  be  distinctly  under- 
stood that  this  postponement  does  not  in  the  slight- 
est degree  affect  the  period  of  the  loan.  Thus,  if  a 
loan  is  granted  for  25  years  and  the  payment  of  the 
first  instalment  is  postponed  to  the  fourth  year,  the 
repayment  of  the  debt  must  be  effected  during  the 
last  22  years  of  the  loan.  During  the  first  three 


130     The  Place  of  'Agriculture  in  Reconstruction 

years  the  borrower  pays  only  the  interest  on  the 
amount  borrowed  at  the  rate  of  1  per  cent. 

Let  us  take- in  illustration  a  loan  of  $2,000  for  25 
years.  If  the  borrower  begins  his  payments  the 
first  year,  he  will  pay  for  25  years  an  annual  in- 
stalment of  $90.81.  If,  on  the  other  hand,  he  de- 
cides not  to  begin  the  amortization  of  his  loan  until 
the  fourth  year,  he  will  pay  during  the  first  three 
years  only  the  interest  at  1  per  cent  on  his  loan  of 
$2,000,  or  $20  a  year ;  and,  the  debt  having  to  be  ex- 
tinguished in  22  years  instead  of  25  years,  the  an- 
nual instalment  will  necessarily  be  larger  in  that 
case  than  it  would  have  been  otherwise.  In  other 
words,  by  beginning  to  pay  on  his  debt  the  fourth 
year,  the  borrower,  instead  of  paying  $90.81,  must 
pay  an  annual  instalment  of  $101.73  to  redeem  his 
debt  in  22  years. 

The  method  of  calculating  the  annual  instalment 
will  be  the  same  in  case  the  postponement  of  the 
first  instalment  is  for  one  year  or  two  years  in- 
stead of  for  three  years  as  indicated  above. 

8.  Loans  in  partial  payments.  When  loans  are 
made  for  certain  forms  of  farm  improvement  or 
transformation  extending  over  a  long  period  of 
time,  or  for  certain  kinds  of  equipment,  materials  or 
live  stock,  the  banks  and  societies  making  the  loans 
are  not  required  to  pay  over  immediately  the  total 
amount  of  the  loan  granted  and  may  calculate  the 


Analysis  of  the  French  System          131 

instalments  to  be  paid  by  borrowers  on  the  basis 
of  the  money  advanced  in  partial  payments  to  them. 
Article  6  of  the  decree  of  July  19, 1918,  provides  that 
the  money  may  be  advanced  in  proportion  to  the 
progress  of  the  work  or  the  delivery  of  supplies. 
The  state  of  the  work  or  of  the  delivery  of  supplies 
must  be  indicated  by  means  of  affidavits  or  bills.  It 
is  also  an  indispensable  requirement  that  a  repre- 
sentative of  the  societies  making  the  loans  shall  have 
authority  to  enter  upon  the  premises  to  establish 
the  exact  status  of  the  improvements  in  order  to 
lay  the  matter  before  the  council  of  administration 
for  its  decision  with  full  knowledge  of  the  facts  in 
the  case. 

The  instalments  ought  to  be  calculated  in  view 
of  the  exact  state  of  affairs.  A  borrower  may,  if  he 
chooses,  either  defer  the  payment  of  his  first 
amortizement  to  the  year  following  the  payment  to 
him  of  his  entire  loan,  providing  that  this  postpone- 
ment does  not  exceed  three  years,  or  the  instalment 
may  be  calculated  on  the  basis  that  the  separate 
advances  were  loans  successively  made  for  the  num- 
ber of  years  between  the  time  the  loan  was  made 
and  the  termination  of  the  work. 

This  may  be  illustrated  by  an  example.  Suppose 
a  loan  of  $2,000  is  made  for  25  years  for  the  purpose 
of  putting  into  good  cultivated  condition  a  farm 
which,  at  the  time  of  making  the  loan,  is  actually  in  a 


132     The  Place  of  Agriculture  in  Reconstruction 

run-down  condition.  The  cost  of  the  work  is  to  be 
spread  over  three  years.  The  borrower  is  in  need 
of  $600  immediately;  he  is  reckoning  on  expending 
$800  during  the  first  year,  and  the  balance  of  $600 
remaining  of  the  total  loan  he  expects  to  have  ex- 
pended by  the  end  of  the  second  year.  The  bank  or 
society  will  thus  advance  to  him: 

$600  immediately; 

$800  up  to  the  end  of  the  first  year; 

$600  up  to  the  end  of  the  second  year. 

In  reality  this  will  be  three  loans  granted  suc- 
cessively to  the  party  interested,  the  first  loan  of 
$600  being  for  25  years,  the  second  loan  of  $800  for 
24  years,  and  the  third  loan  of  $600  for  23  years. 
The  annual  instalment  to  be  paid,  therefore,  will 
be: 

$27.24  to  the  end  of  the  first  year; 

$27.24  +  $37.66  =  $64.90  to  the  end  of  the  second  year; 

$27.24  +  $37.66  +  $29.33  =  $94.23  for  the  last  23  years. 

If,  on  the  other  hand,  the  borrower  prefers  not  to 
commence  to  pay  off  his  loan  before  the  contemplated 
farm  work  has  been  completed  and  has  begun  to  be 
productive,  at  the  end  of  the  third  year  he  will  pay 
the  sum  of  $97.77,  which  is  the  annual  instalment 
required  to  repay  a  loan  of  $2,000  in  23  years.  But 
up  to  the  end  of  the  third  year  he  will  simply  pay 
interest  at  1  per  cent  for  the  sums  actually  advanced, 
which  would  be  $6  for  the  first  year  and  $14  for  the 
second  year. 


Analysis  of  the  French  System          133 

9.  Subsidies  for  children.  For  the  purpose  of 
aiding  in  the  establishment  of  homesteads  and  of  en- 
couraging large  families,  article  6  of  the  law  pro- 
vides that  the  sum  of  10  cents  for  every  $20  bor- 
rowed shall  be  annually  granted  by  the  government 
to  the  society  making  a  loan  for  every  legitimate 
child  born  to  a  borrower  after  his  loan  has  been 
made.  The  government  subsidy  thus  given  is  to  be 
applied  by  the  society  in  decreasing  the  instalment 
annually  paid  by  the  borrower  on  his  debt. 

These  sums  granted  by  the  government  are  paid 
directly  into  the  treasury  of  the  societies  making 
the  loans  by  the  Secretary  of  Agriculture  to  the 
rural  credit  societies  and  by  the  Secretary  of  Labor 
to  the  land  credit  societies.  Instead  of  paying  his 
regular  annual  instalment,  therefore,  a  borrower  will 
pay  each  year  the  difference  between  his  total  instal- 
ment and  the  subsidy  granted  by  the  government. 


By  way  of  illustration,  let  us  take  a  loan  of  $2,000  for  25  years, 
the  annual  instalment  on  which  would  be $90.81 

If  one  child  is  born  after  a  loan  has  been  granted,  the 
government  will  pay  in  behalf  of  the  borrower  $10,  and 
the  latter 's  annual  instalment  on  his  loan  will  be  only. .  $80.81 

If  two  children  are  born  to  him,  the  government  will  pay 

$20,  and  the  borrower's  annual  instalment  will  be. .  $70.81 

If  three  children  are  born,  the  government  will  pay  $30, 

and   the   borrower's    annual   instalment   will   be $60.81 

If  six  children  are  born,  the  government  will  pay  $60,  and 

the  borrower's  annual  instalment  will  be $30.81 

If  nine  children  are  born,  the  government  will  pay  $90, 
and  the  borrower's  annual  instalment  will  be  reduced 
to  81  cents  a  year. 

With  the  birth  of  a  tenth  child,  a  borrower's  annual  in- 
stalment will  be  a  charge  against  the  government  en- 
tirely until  the  debt  is  paid. 


134    The  Place  of  'Agriculture  in  Reconstruction 

10.  Unseizable  homesteads.  In  order  to  enable 
borrowers  to  constitute  their  rural  small  holdings 
into  unseizable  homesteads,  two  amendments  were 
added  to  the  law  of  July  12, 1909. 

Subscribing  to  a  wish  many  times  presented  to 
Parliament  by  representatives  of  the  district  agri- 
cultural credit  banks  through  the  National  Federa- 
tion of  Mutual  Insurance  and  Agricultural  Coopera- 
tive Societies,  section  1  of  article  7  of  the  law  has 
provided  that  the  establishment  of  rural  small  hold- 
ings, which  were  the  object  of  individual  long-time 
loans,  into  unseizable  homesteads  would  not  there- 
after prevent  the  societies  which  made  the  loans 
from  foreclosing  the  property  and  executing  a  judg- 
ment thereon  in  case  of  necessity.  Such  societies  are 
thereby  entitled  to  the  privileges  granted  under  sec- 
tion 2  of  article  2103  of  the  code  of  Civil  Procedure. 
They  must,  however,  specifically  state  the  fact  in  the 
mortgage  in  conformity  with  article  10  of  the  regula- 
tions for  the  public  administration  of  the  act. 

It  is  important  to  note  that  the  amendment  will  op- 
erate not  only  in  favor  of  loans  granted  under  the 
law  of  April  9,  1918,  but  also  of  those  made  under 
the  law  of  March  19,  1910.  It  is  certain  that  this 
provision  will  encourage  the  development  of  home- 
steads, whose  owners  formerly  were  seriously  handi- 
capped because  of  the  difficulty  of  reaping  the  bene- 
fits of  agricultural  credit  institutions. 

On  the  other  hand,  the  beneficiaries  of  the  new  law, 


Analysis  of  the  French  System          135 

both  the  unmarried  and  those  without  children,  will 
be  able  to  establish  for  their  benefit  into  an  unseiz- 
able  homestead  "the  land  purchased,  improved, 
transformed  or  reconstructed  by  them"  under  the 
provisions  of  the  law  of  April  9,  1918,  but  only  on 
the  condition  of  contracting  marriage  within  a  period 
of  three  years  from  the  time  of  making  the  home- 
stead declaration.  If  this  condition  is  not  fulfilled 
within  the  time  specified,  any  one  interested  will  be 
able  to  have  the  homestead  request  declared  null  and 
void. 

11.  Amendments  to  statutes  and  by-laws.  In 
order  to  put  into  effect  the  provisions  of  article  1 
of  the  law  of  April  9,  1918,  it  is  absolutely  neces- 
sary that  the  rural  credit  societies  and  land  credit 
societies  conform  their  statutes  to  article  1  of  the 
decree.  Where  the  need  calls  for  it,  they  ought 
to  either  amend  or  complete  their  statutes  accord- 
ingly. 

As  a  matter  of  fact,  the  great  majority  of  land 
credit  societies  are  already  prepared  under  their 
statutes  to  carry  out  the  provisions  of  the  law. 
Article  1  of  their  statutes  provides  in  effect  that  they 
are  regulated  "by  the  law  of  April  10,  1908,  and 
subsequent  laws  pertaining  thereto."  The  statutes 
of  certain  district  agricultural  credit  banks  contain 
a  similar  regulation.  These  societies,  therefore,  will 
be  able  immediately  to  put  into  effect  the  provisions 


136     The  Place  of  Agriculture  in  Ee construction 

of  the  law  of  April  9,  1918.  But  those  societies  or 
district  banks  whose  statutes  do  not  contain  a  simi- 
lar regulation  ought  to  amend  them  without  delay 
on  this  point  and  should  submit  them  in  amended 
form  to  the  Secretary  of  Labor  or  to  the  Secretary 
of  Agriculture  for  his  approval  according  as  either 
has  jurisdiction.  Moreover,  the  land  credit  so- 
cieties which  deem  it  necessary  to  extend  their  terri- 
tory in  order  to  more  easily  carry  out  the  new  law 
should  immediately  petition  the  Secretary  of  Labor 
for  permission  to  amend  their  statutes  in  this  par- 
ticular. 

On  the  other  hand,  it  is  necessary  that  the  char- 
tered life  of  the  societies  is  sufficiently  long  to  per- 
mit of  their  making  the  contemplated  long-time 
loans.  Evidently  they  would  not  be  able  to  make 
loans  for  a  period  of  25  years  if  their  charters  do 
not  provide  for  a  minimum  life  of  at  least  26  years 
at  the  time  of  commencing  operations.  If  it  is  neces- 
sary the  required  change  should  be  made  in  their 
statutes. 

Finally,  in  conformity  with  article  2  of  the  regu- 
lations for  their  public  administration,  the  banks  and 
societies  making  the  loans  ought  to  take  it  upon 
themselves  to  pass  by-laws  determining  the  condi- 
tions under  which  the  use  and  repayment  of  loans 
shall  be  assured,  and  also  indicating  the  supple- 
mentary security  which  would  be  required  of  bor- 
rowers. The  by-laws  of  the  rural  credit  societies 


Analysis  of  the  French  System          137 

should  be  submitted  to  the  Secretary  of  Agriculture 
for  his  approval;  those  of  land  credit  societies  to 
the  Secretary  of  Labor  and  the  Secretary  of  Agri- 
culture for  their  joint  approval. 

Advances  of  Government  Fwnds 

Article  4  of  the  law  of  April  9,  1918,  indicates  the 
source  of  funds  by  means  of  which  the  land  credit 
societies  and  rural  credit  societies  can  make  loans 
to  military  pensioners  and  civilian  victims  of  the 
war.  Paragraph  1  authorizes  these  societies  to  re- 
ceive, for  the  exclusive  use  of  loans  granted  under 
the  conditions  provided  by  article  1,  special  ad- 
vances of  funds  mthout  interest,  raised  by  a  per- 
centage of  the  general  appropriation  for  agricul- 
tural credit  reserved  for  long-time  individual  credit 
by  the  law  of  March  19,  1910. 

As  had  already  been  decreed  by  the  Senate,  so 
also  article  11  of  the  regulations  for  the  public  ad- 
ministration of  the  law  specified  that  the  district 
agricultural  credit  banks  were  meant,  to  the  ex- 
clusion of  the  local  credit  banks,  which  should  re- 
ceive government  funds  made  by  application  of  the 
law  of  April  9,  1918.  The  law  allows  the  commis- 
sion provided  by  article  5  to  determine  the  amount 
of  funds  that  should  be  advanced  to  the  banks  and 
societies  interested. 

The  government  funds  advanced  to  the  district 
agricultural  cooperative  credit  banks  and  to  the  land 


138    The  Place  of  ^Agriculture  in  Reconstruction 

credit  societies,  while  being  loaned  for  a  maximum 
period  of  25  years,  are  themselves  repayable  to  the 
government  by  annual  instalments  and  for  periods 
of  time  not  exceeding  26  years.  These  annual  in- 
stalments are  payable  to  the  government  before  the 
end  of  January  of  each  year.  If  the  banks  and  so- 
cieties grant  deferred  loans  to  certain  borrowers 
from  whom  they  will  not  receive  any  amortizements 
on  their  debt  during  the  first  three  years,  they  too 
are  also  permitted  to  decrease  or  to  postpone  the 
amortizement  of  their  debt  for  the  first  three  years 
on  presentation  of  evidence  justifying  the  same.  It 
is  nevertheless  intended,  as  provided  by  article  14 
of  the  regulations,  that  the  repayment  of  govern- 
ment funds  shall  in  no  case  exceed  a  total  period  of 
26  years. 

Article  15  of  the  decree  provides  that  the  examina- 
tion of  land  credit  societies  by  bank  examiners  shall 
not  be  made  except  on  those  accounts  provided  by  the 
law  of  April  9,  1918,  and  only  then  to  the  extent  of 
exercising  control  over  the  latter  transactions.  It  is 
expected  that  these  accounts  will  be  of  a  special  char- 
acter and  so  carried  in  the  general  ledger  of  each  so- 
ciety. 

The  law  of  March  19,  1910,  provides  that  the  dis- 
trict agricultural  credit  banks  shall  not  receive  in 
government  funds  for  individual  long-time  credit 
more  than  double  their  subscribed  capital.  But  by 
an  amendment  offered  by  Deputy  Fernand  David, 


Analysis  of  the  French  System          139 

former  Secretary  of  Agriculture,  the  new  law  ex- 
tends this  limit  in  favor  of  those  still  in  the  army. 
The  last  paragraph  of  article  7  provides  that,  for 
long-time  loans  granted  in  behalf  of  enlisted  sol- 
diers under  the  law  of  March  9,  1910,  the  total  of 
government  funds  advanced  thereafter  shall  be  in- 
creased to  four  times  the  subscribed  capital  of  the 
banks  and  societies,  but  that  it  shall  at  no  time  ex- 
ceed that  amount.  Article  17  of  the  regulations  for 
the  public  administration  of  the  law  gives  directions 
to  the  district  agricultural  credit  banks  how  to  pro- 
cure these  government  funds  under  this  provision. 

Special  Provisions 

1.  District  and  local  agricultural  credit  banks. 
The  district  agricultural  credit  banks  are  the  class 
of  banks  which  may  receive  advances  of  govern- 
ment funds,  the  local  rural  credit  banks  being  ex- 
cluded from  this  privilege.  Since  the  former  are 
required  to  repay  to  the  .government  annual  instal- 
ments on  these  loans,  they  must  provide  all  neces- 
sary guaranties  to  secure  themselves  against  every 
risk  of  non-payment. 

It  is  by  means  of  the  local  rural  credit  societies 
that  the  district  banks  principally  receive  their  ap- 
plications for  loans.  It  is  to  them  that  the  dis- 
trict banks  address  the  necessary  inquiries  concern- 
ing any  particular  property.  Moreover,  it  is  the 
local  credit  banks  which  in  most  instances  send  their 


140    The  Place  of  Agriculture  in  Reconstruction 

requests  for  loans  to  them.  Consequently,  it  is 
vitally  important  that  the  district  banks  send  special 
instructions  to  the  local  banks  in  order  that  the  latter 
may  properly  inform  their  members.  In  short,  it  is 
a  matter  of  business  prudence  for  the  district  banks 
not  to  make  any  loan  without  first  having  consulted 
with  the  local  banks. 

But  what  part  do  the  local  banks  play  in  the 
making  of  a  loan?  Let  us  see. 

By  the  law  of  March  19, 1910,  individual  long-time 
loans  are  made  as  often  by  local  credit  societies  by 
means  of  loans  to  them  from  the  district  banks  as 
by  the  district  banks  through  the  local  banks  as 
intermediaries  acting  conjointly  in  the  mortgage; 
or  again,  by  the  district  banks  themselves  by  the 
simple  intervention  of  the  local  banks  in  determin- 
ing the  financial  standing  of  the  borrower  without 
the  local  banks  appearing  as  responsible  inter- 
mediaries. 

Now,  a  new  fact  is  brought  in  which  differentiates 
the  law  of  April  9, 1918,  from  that  of  March  19, 1910, 
namely,  that  the  rate  of  interest  which  was  formerly 
2  per  cent  is  reduced  to  1  per  cent.  It  seems  diffi- 
cult, even  impossible,  on  an  income  so  small  to  al- 
low a  part  of  it  to  the  local  banks.  But  if  the  local 
banks  are  not  allowed  a  part  of  the  interest  paid, 
they  will  not  accept  any  responsibility  in  the 
transaction.  Let  it  also  be  added  that,  in  accepting 
the  local  banks  as  intermediaries  in  making  loans, 


Analysis  of  the  French  System          141 

there  is  a  greater  risk  of  increasing  the  expenses 
of  registration — that  is,  the  right  of  security  which 
amounts  actually  to  0.625  per  cent.  Finally,  it  is 
important  to  cut  out  formalities  and  reduce  the  costs 
of  a  loan  if  the  district  banks  are  to  be  placed  on 
the  same  footing  with  land  credit  societies,  which 
can  lend  directly  to  borrowers  without  the  use  of 
local  banks  as  intermediaries. 

The  law  does  not,  however,  state  this  subject 
definitely.  It  providers  only  that  "  loans  can  be 
granted  by  rural  credit  societies,"  and  the  regula- 
tions for  the  public  administration  of  the  law  re- 
peats the  same  expression,  confounding,  therefore, 
the  district  banks  and  the  local  banks  as  being  among 
the  societies  which  can  carry  out  the  provisions  of 
the  law  of  April  9, 1918.  It  is,  then,  for  the  district 
banks  to  provide  in  their  by-laws  the  necessary 
rules  pertaining  to  this  subject.  In  accordance  with 
article  2  of  the  regulations  for  the  public  adminis- 
tration of  the  act,  the  by-laws  should  indicate  "the 
conditions  under  which  the  use  of  loans  shall  be  pro- 
cured/' 

2.  Land  Credit  Societies.  There  are  two  provi- 
sions of  the  law  of  April  9, 1918,  that  are  of  particu- 
lar interest  to  land  credit  societies  and  which  merit 
special  mention. 

In  the  first  place,  paragraph  3  of  article  2  pre- 
scribes the  granting  of  a  provisional  certificate  as 


142     The  Place  of  Agriculture  in  Reconstruction 

to  the  sanitary  condition  of  the  buildings  or  rural 
small  holdings  purchased,  improved,  transformed  or 
reconstructed ;  and,  in  order  to  avoid  every  difficulty 
in  rural  districts  in  this  matter,  by  enlarging  the 
provisions  of  section  3  of  article  3  of  the  law  of  April 
10,  1908,  Parliament  has  provided  that  the  provi- 
sional certificates  as  to  sanitation  may  be  delivered 
by  a  representative  of  the  rural  committee  on  home 
visitation  and  social  welfare,  said  representative  to 
be  chosen  by  the  committee  in  each  township  from 
among  the  members  of  agricultural  associations  for 
manufactured  products,  agricultural  societies,  rural 
cooperative  production  societies,  mutual  rural  credit 
banks,  mutual  rural  insurance  societies,  or  county 
committees  on  injuries. 

In  the  second  place,  section  1  of  article  3  oT  the 
new  law  prescribes  that  not  only  military  pensioners 
and  civilian  victims  of  the  war,  who  borrow  for  the 
purpose  of  purchasing  a  rural  small  holding,  shall 
be  relieved  of  the  obligation  of  having  at  least  one- 
fifth  of  the  purchase  price,  but  also  those  who  pur- 
chase a  dwelling  house  or  plot  of  ground  in  town  or 
city  under  the  provision  of  the  laws  of  April  12, 
1906,  April  10,  1908,  or  February  11,  1914. 

These,  then,  are  the  various  observations  which  it 
has  seemed  necessary  to  make  in  order  to  facilitate 
the  operation  of  the  new  law,  upon  which,  we  are 
fully  persuaded,  depends  the  unification  of  all  its 
provisions  and  the  enjoyment  of  all  its  benefits. 


Analysis  of  the  French  System          143 

Limitations  of  the  French  System 

The  preceding  discussion  brings  out  clearly  the 
financial  limitations  of  the  French  plan  of  encourag- 
ing land  settlement  by  soldiers  and  sailors.  A  most 
striking  and  highly  commendable  feature  is  the  low 
interest  rate  of  1  per  cent.  But  the  benefits  of  this 
low  rate  of  interest  can  only  be  enjoyed  by  military 
and  civilian  victims  of  the  war.  The  able-bodied 
soldier  or  sailor  on  demobilization  will  receive  no 
grant  of  free  land  from  the  government.  The  only 
financial  aid  offered  to  demobilized  men  is  the  free 
registration  of  deeds  to  land  purchased  for  farming 
purposes  by  those  who  had  been  farmers,  tenants  or 
farm  laborers  before  the  war. 

Another  limitation  is  the  amount  of  the  loan 
granted.  This  cannot  exceed  $2,000  no  matter  how 
large  may  be  the  acreage  of  the  farm.  On  small 
farms  and  market  gardens,  which  are  characteristic 
of  a  large  part  of  France,  a  maximum  loan  of  $2,000 
might  serve  every  financial  purpose  of  the  average 
farmer.  But  for  larger  general  farms,  vineyards 
and  olive  groves,  a  loan  of  $2,000  would  be  too 
limited  to  aid  materially  in  any  great  increase  in 
agricultural  production.  In  view  of  the  fact,  how- 
ever, that  the  loan  benefits  of  the  act  are  confined  to 
military  and  civilian  victims  of  the  war,  whose  physi- 
cal disability  will  be  a  serious  handicap  to  any  great 
productive  effort,  it  is  not  at  all  unlikely  that  the 


144     The  Place  of  Agriculture  in  Reconstruction 

limitation  of  a  loan  to  a  maximum  of  $2,000  was  in- 
tended to  encourage  as  much  as  possible  the  de- 
velopment of  small  farms  and  market  gardens,  be- 
cause they  offer  the  best  conditions  of  agricultural 
success  in  France.  So  many  men  were  killed  during 
the  war  that  the  government  found  it  impossible  to 
furnish  farm  labor  to  cultivate  the  fields,  vineyards 
and  olive  groves  for  three  years  preceding  the  re- 
turn of  peace.  After  demobilization,  however,  it  is 
expected  to  provide  abundance  of  labor  from  the 
discharged  military  forces.  An  inquiry  made  by  the 
government  among  thousands  of  French  soldiers 
brought  out  the  fact  that  more  than  half  of  them 
were  unwilling  to  go  back  to  their  former  industrial 
positions.  From  these  men  will  come  many  of  the 
future  farmers  of  France,  but  no  government  aid  is 
given  to  them  in  the  form  of  either  land  or  capital. 
In  all  probability,  therefore,  the  discharged  soldiers 
will  enter  upon  their  new  occupations  as  farm  labor- 
ers or  tenant  farmers. 

A  third  limitation  is  the  period  of  a  loan.  This 
cannot  exceed  25  years,  and  even  this  period  is  de- 
pendent upon  the  age  of  the  borrower  at  the  time  of 
procuring  his  loan.  This  period,  however,  is  an 
extension  of  10  years  on  the  period  of  loans  to  rural 
credit  societies  by  the  provisions  of  the  law  of  March 
19,  1910.  Notwithstanding  the  extension  of  time  to 
25  years,  it  would  under  normal  agricultural  condi- 
tions be  too  short  if  interest  rates  on  loans  were  as 


Analysis  of  the  French  System          145 

high  as  they  are  in  the  United  States.  Farm  mortgage 
loans  under  the  Federal  farm  loan  system  may  be 
made  for  a  period  as  long  as  40  years,  but  the  in- 
terest rate,  originally  5  per  cent,  was  raised  to  5% 
per  cent  under  war  conditions.  But  with  a  low  in- 
terest rate  of  1  per  cent  and  with  the  additional 
privilege  of  postponing  the  payments  on  the  debt 
for  the  first  three  years,  the  comparatively  short 
period  of  25  years  on  farm  mortgage  loans  to  mili- 
tary and  civilian  victims  of  the  war  in  France  is 
practically  offset  to  a  great  degree.  Under  these 
conditions,  a  borrower  might  have  no  difficulty  in 
meeting  the  obligations  on  his  loan  in  normal  sea- 
sons, notwithstanding  the  economic  handicap  due  to 
his  physical  disability. 

When  all  the  conditions  of  agriculture  in  France 
are  taken  into  consideration,  the  limitations  sur- 
rounding actual  land  settlement  by  soldiers  and 
sailors  present  no  serious  problem.  The  farm  labor 
forces  will  undoubtedly  adjust  themselves  to  the  new 
conditions  of  life  which  reconstruction  will  require. 
It  may  be  expected,  therefore,  that  the  law  of  April 
9,  1918,  will  result  in  establishing  a  sound  land  set- 
tlement system  and  in  increasing  agricultural  pro- 
duction, which  is  its  fundamental  object. 


CHAPTEE  VII.— LAND  SETTLEMENT  BY  EE- 
TUENED  SOLDIEES  IN  CANADA 

The  preceding  chapters  have  outlined  national 
programs  of  land  settlement  and  government  aid  in 
Great  Britain  and  France.  These  two  countries  serve 
to  illustrate  the  economic  and  financial  problems 
which  lie  ahead  of  practically  all  nations  in  Europe. 

A  large  population  in  a  small  land  area,  which  is 
typical  in  European  countries,  naturally  raises  al- 
together different  problems  from  those  which  con- 
front either  Canada  or  the  United  States.  The  land 
areas  in  Great  Britain  and  France  are  so  limited  in 
extent  that  the  idea  of  supplying  farms  to  all  dis- 
charged able-bodied  soldiers  and  sailors  who  might 
want  to  engage  in  farming  for  a  living  is  altogether 
beyond  the  possibility  of  realization.  Even  on  the 
subject  of  supplying  government  financial  aid,  it  has 
been  found  necessary  to  limit  this  form  of  assistance 
largely  to  disabled  ex-service  men  and  to  those  civil- 
ians who  have  suffered  bodily  injuries  because  of 
the  great  war. 

The  problems  facing  Canada  and  the  United  States 
during  the  reconstruction  period  and  afterwards 
ought  to  be  solved  more  readily  than  they  can  be  in 

146 


Land  Settlement  by  Returned  Soldiers    147 

Europe.  Land  areas  on  the  American  continent  are 
more  extensive,  there  is  considerable  public  land 
open  to  settlement,  large  tracts  of  unused  land  owned 
by  individuals  and  corporations  are  held  for  specula- 
tive purposes,  smaller  land  areas  capable  of  cultiva- 
tion are  no  longer  used  for  crop  production  or  for 
grazing  live  stock,  there  are  hundreds  of  so-called 
"abandoned"  farms  which  could  easily  be  acquired 
and  made  economically  profitable  as  individual  farm 
units,  and  the  average  size  of  farms  is  considerably 
larger  than  they  are  in  Europe. 

In  the  matter  of  rural  population  there  is  prac- 
tically no  problem  at  all  either  in  Canada  or  in  our 
own  country  so  far  as  opportunity  and  demand  for 
land  settlement  is  concerned.  Both  countries  for  the 
present  and  for  many  years  to  come  can  easily  ab- 
sorb all  the  labor  forces  seeking  productive  employ- 
ment on  the  land  as  gardeners,  farmers,  stock  raisers 
and  other  pursuits  directly  or  indirectly  connected 
with  agriculture.  The  demand  for  food  will  keep 
pace  with  the  increase  in  our  own  population  and 
the  present  and  future  pressing  needs  of  the  Euro- 
pean nations ;  while  the  demand  for  the  raw  materials 
of  many  industries,  which  are  produced  from  the 
land, — such  as  lumber,  hides,  cotton,  wool,  flax,  hemp, 
and  many  others, — will  call  for  a  vast  amount  of 
labor,  which  a  large  demobilized  army  and  navy  will 
set  loose  upon  the  labor  market  to  meet  the  require- 
ments of  our  own  industries  and  those  abroad. 


148    The  Place  of  Agriculture  in  Reconstruction 

Training  Disabled  Men  for  Farming 

Looking  these  facts  squarely  in  the  face,  the  Do- 
minion of  Canada  early  began  to  plan  for  a  rational 
system  of  land  settlement  and  government  aid.  Not 
long  after  the  Canadian  Expeditionary  Force  had 
begun  to  take  its  heroic  place  on  the  western  battle 
front  in  Europe,  a  stream  of  wounded  and  disabled 
men  turned  its  course  homeward.  On  their  arrival 
Canada  was  confronted  with  the  problem  of  train- 
ing these  men  to  take  their  places  once  more  as  pro- 
ductive economic  units  in  agricultural  and  industrial 
pursuits. 

Since  agriculture  not  only  offered  an  out-door  life 
but  its  products  were  in  great  demand,  the  Canadian 
government  set  about  its  new  task  of  training  par- 
tially disabled  soldiers  and  sailors  in  various  lines  of 
gardening,  general  farming  and  stock  raising.  The 
work  was  placed  under  the  direction  of  a  new  branch 
of  the  government  called  the  Department  of  Soldiers ' 
Civil  Eeestablishment.  Let  us  briefly  consider  the 
Dominion  program  particularly  as  it  relates  to  the 
training  of  partially  disabled  men  for  farming  and 
kindred  forms  of  rural  labor. 

1.  Occupational  therapy.  This  branch  of  training 
is  strictly  diversional  in  character,  the  aim  being  to 
occupy  the  patient's  mind  and  body  that  nature 
might  better  assist  in  restoring  the  developing 


Land  Settlement  by  Returned  Soldiers    149 

broken  cells  and  tissues.  The  work  is  given  to  the 
men  on  lands  connected  with  the  hospitals  and  san- 
atoria which  are  under  direct  control  of  the  above- 
named  department. 

The  range  of  out-door  work  in  agricultural  occupa- 
tional therapy  is  very  wide  and  varied,  being  in- 
tended to  embrace  the  capacity  of  men  no  matter 
what  their  form  of  disability.  But  the  patients  are 
not  entirely  left  to  choose  their  own  occupation,  since 
the  kind  and  amount  of  work  are  determined  by  the 
medical  officer  in  charge  of  the  institution.  He  issues 
instructions,  similar  to  writing  a  prescription,  which 
outline  the  exercise  and  movements  a  particular 
patient  should  have  so  that  muscles  and  nerves  may 
learn  to  function  in  the  restoration  of  his  disability. 

The  lines  of  work  in  occupational  therapy,  which 
relate  to  agriculture  and  rural  life,  are  poultry  rais- 
ing, market  gardening,  animal  husbandry,  horticul- 
ture, bee  keeping,  seed  testing  and  seed  germination. 
To  those  who  are  not  seriously  disabled  training  is 
given  in  farm  mechanics,  such  as  the  construction, 
care  and  operation  of  a  tractor,  thresher,  gas  engine 
and  automobile.  An  extremely  practical  feature  of 
farm  mechanics  is  that  connected  with  the  construc- 
tion and  repair  of  farm  buildings.  The  work  is  done 
in  shops  on  the  grounds  of  the  various  institutions 
and  includes  harness  mending,  light  blacksmithing, 
and  the  repair  of  wooden  parts  of  farm  machinery 
and  buildings,  such  as  hen  and  hog  houses,  barns, 


150     The  Place  of  Agriculture  in  Reconstruction 

silos,  racks  and  cribs.  These  various  lines  of  work 
not  only  train  men  in  the  efficient  use  of  tools,  but 
give  them  sufficient  dexterity  so  that  on  taking  upeac- 
tive  farm  life  they  may  be  capable  of  making  minor 
repairs  on  machinery  and  buildings  upon  the  place. 

This  training  is  conducted  mainly  in  the  Lake  Ed- 
ward Sanatorium,  Lake  Edward,  Que. ;  Guelph  Mili- 
tary Hospital,  Guelph,  Ont.;  at  Tuxedo  Farm,  the 
Manitoba  Military  Convalescent  Home,  and  at  sev- 
eral other  institutions.  As  a  matter  of  fact,  all  the 
Canadian  hospitals  and  sanatoria  used  for  soldiers 
in  suburban  or  rural  districts  are  possessed  of  suf- 
ficient acreage  devoted  to  the  training  of  men  in 
gardening  and  light  farm  work  to  give  them  a  prac- 
tical knowledge  of  their  chosen  occupation. 

When  disabled  soldiers  and  sailors  are  sufficiently 
strong  to  leave  the  hospitals  and  sanatoria,  they 
have  open  to  them  for  choice  some  200  reeducation, 
agricultural  and  industrial  courses.  An  order  of 
the  government  provides  that  "any  member  of  the 
Canadian  Expeditionary  Force  who  has  been  so  dis- 
abled in  the  line  of  duty  that  he  can  no  longer  pursue 
his  former  occupation  is  entitled  to  a  retraining 
course  which  will  fit  him  for  earning  a  living  at 
some  kind  of  work  at  which  his  disability  will  not 
disqualify  him. ' ' 

The  reeducation  courses  which  might  be  termed 
"agricultural"  are  mixed  farming,  stock  raising, 
market  gardening  and  farm  mechanics.  The  institu- 


Land  Settlement  by  Returned  Soldiers    151 

tions  where  these  practical  courses  are  given  are 
MacDonald  College,  Montreal;  Nova  Scotia  Agri- 
cultural College,  Truro,  N.  S.;  Manitoba  Agricul- 
tural College,  Winnipeg,  Man.;  University  of  Sas- 
katchewan, Saskatoon,  Sask. ;  School  of  Agriculture, 
Olds,  Alberta ;  and  the  University  of  British  Colum- 
bia, Vancouver,  B.  C.  These  institutions  were  al- 
ready provincial  agricultural  colleges  devoted  to  the 
training  of  young  farmers  in  Canada,  and  inspection 
of  their  equipment  and  lines  of  work  showed  that 
they  were  adequate  in  every  way  for  the  agricultural 
training  of  a  small  number  of  men  in  the  returned 
soldiers'  group. 

To  increase  the  facilities  of  these  institutions  and 
to  make  provision  for  the  training  of  a  larger  num- 
ber of  disabled  soldiers  and  sailors,  the  Department 
of  Soldiers'  Civil  Eeestablishment  enlarged  their 
equipment  by  supplying  special  machinery,  various 
kinds  of  tractors,  plows,  and  other  farming  imple- 
ments in  order  that  the  training  might  be  most  in- 
tensive and  practical.  But,  in  pursuing  these  courses 
of  study,  the  groups  of  soldier  students  are  segre- 
gated from  the  young  civilian  students  because  ex- 
perience has  demonstrated  that  a  returned  soldier 
has  a  mental  attitude  which  enables  him  to  do  his 
best  only  when  surrounded  by  fellow  army  comrades 
and  instructors  who  have  seen  service  in  France. 

Usually  the  men  who  take  up  these  intensive 


152     The  Place  of  Agriculture  in  Reconstruction 

agricultural  courses  are  not  physically  able  to  do 
the  harder  kinds  of  farm  work.  But  the  special 
training  given  them  in  the  agricultural  schools  more 
than  offset  their  physical  disability  by  the  increased 
knowledge  and  experience  acquired.  The  develop- 
ment of  intelligence  rather  than  muscle  enables  the 
disabled  soldiers  to  perform  their  tasks  successfully 
when  they  engage  in  practical  farming  for  them- 
selves. In  nearly  all  cases  the  directors  of  courses 
of  study  insist  that  the  previous  experience  of  the 
soldier  student  should  be  the  guiding  principle  and 
the  foundation  on  which  his  new  course  is  to  be  es- 
tablished, and  this  no  doubt  enables  the  returned 
soldier  to  learn  more  readily  and  tends  to  make  of 
his  agricultural  training  a  complete  success. 

While  agricultural  work  for  disabled  soldiers  in 
Canada  has  not  yet  been  fully  developed,  the  Land 
Settlement  Board  is  working  on  plans  for  assisting 
them  to  become  actual  farmers.  A  great  many  of 
the  men  who  eventually  will  take  advantage  of  gov- 
ernment assistance  in  securing  a  homestead  or  a 
farm  are  being  educated  by  these  institutions  in  farm 
mechanics  and  trained  in  the  use  of  tractors  and 
other  farm  apparatus.  The  government  aid  and 
special  training  given  these  men  tend  to  counter- 
balance their  physical  disability  and  to  make  of  them 
efficient  economic  units  once  more  in  the  production 
of  wealth  from  the  soil. 


Land  Settlement  by  Returned  Soldiers    153 

2.  Systematic  Courses  in  Agriculture.  As  previ- 
ously stated,  the  various  educational  institutions  in 
the  different  provinces  of  Canada  were  readily 
equipped  at  little  additional  cost  for  teaching  ele- 
mentary practical  agriculture  to  returned  members 
of  the  expeditionary  forces.  The  courses  of  instruc- 
tion cover  five  or  six  months  and  were  so  arranged 
in  the  different  agricultural  colleges  to  meet  the  re- 
quirements of  the  type  of  agriculture  or  stock  rais- 
ing generally  practised  in  the  respective  provinces. 
The  instruction  was  also  made  as  practical  as  pos- 
sible, being  supplemented  by  lectures  when  deemed 
necessary  to  a  proper  understanding  of  the  actual 
farm  work. 

(1)  Animal  husbandry.  This  course  is  given  in 
various  institutions.  A  considerable  part  of  the  time 
is  spent  in  the  practical  judging  of  horses,  beef  and 
dairy  cattle,  sheep  and  hogs.  Near  the  Guelph  Mili- 
tary Hospital  is  an  abattoir  to  which  cattle,  sheep 
and  hogs  are  brought  for  slaughter  to  provide  meat 
for  all  the  provincial  educational  institutions.  This 
gives  the  disabled  soldiers  at  the  Guelph  Hospital 
daily  opportunity  of  judging  beef  cattle  alive  and 
afterwards  by  slaughter  tests  of  estimating  dressing 
percentages.  The  carcasses  are  then  brought  before 
the  students  to  be  cut  up,  to  illustrate  the  relative 
values  of  different  parts  and  the  qualities  desired  in 
a  good  food  animal. 

In  addition  to  this  practical  work,  lectures  are 


154     The  Place  of  Agriculture  in  Reconstruction 

given  on  the  feeding  and  management  of  stock,  the 
principles  of  breeding,  the  history  and  characteristics 
of  different  breeds,  and  on  herd  books  and  pedigrees. 

At  the  University  of  Saskatchewan  the  course  in 
animal  husbandry,  besides  dealing  with  the  char- 
acteristics of  live  stock,  takes  up  the  composition  of 
the  principal  grains,  hay  and  forage  crops,  together 
with  their  value,  importance  and  use  in  live-stock 
feeding.  Particular  attention  is  given  to  the  prac- 
tical phases  of  care  and  feeding,  so  that  studies  are 
devoted  to  proper  rations  for  various  types  of  farm 
animals,  the  essential  features  in  housing  live  stock, 
and  the  feeding,  care  and  development  of  all  types  of 
farm  animals  from  birth  to  maturity  and  marketing. 

(2)  Horticulture.  Most  of  the  agricultural  edu- 
cational institutions  are  well  equipped  for  teaching 
disabled  soldiers  the  elements  of  practical  horticul- 
ture. They  have  orchards  of  tree  fruits,  plantations 
of  small  fruits,  vegetable  gardens,  and  greenhouses. 

Practical  work  is  given  in  the  planting  and  care 
of  young  fruit  trees,  including  budding,  grafting,  cul- 
tivating, pruning,  spraying,  and  thinning;  renovat- 
ing the  old  neglected  orchard ;  and  the  use  of  cover- 
crops.  The  greenhouse  and  outdoor  gardening  work 
consists  of  instruction  in  sowing,  transplanting, 
and  cultivation;  the  use  of  hot  beds;  the  storing 
of  vegetables;  and  backyard  gardening.  A  study 
is  made  of  the  soil  and  cultural  requirements  of 
small  fruits,  tree  fruits  and  vegetables.  Some  time 


Land  Settlement  by  Returned  Soldiers    155 

is  also  devoted  to  a  study  of  economic  problems  con- 
nected with  the  horticultural  industry  as  a  whole. 

(3)  Field  husbandry.    This  course  of  study  lasts 
six  months,  extending  throughout  the  summer,  and 
gives  the  disabled  soldier  a  practical  knowledge  of 
farm  operations.    It  consists  of  studies  on  the  treat- 
ment of  different  types  of  soils,  tillage,  crop  rota- 
tion, fertilizers  and  manures. 

A  study  is  made  of  the  seeds  of  the  various  farm 
crops  grown.  Lectures  are  given  on  purity,  ger- 
mination, cleaning,  selection,  grading  and  improve- 
ment of  seed.  Practise  is  given  in  judging  oats,  bar- 
ley, wheat,  peas,  corn,  grasses,  clovers,  and  seeds 
of  various  fodder  crops. 

(4)  Poultry  raising.    Practical  work  and  instruc- 
tion are  given  in  the  location,  construction,  ventila- 
tion, and  cost  of  poultry  houses.    The  most  impor- 
tant utility  breeds  of  fowls  are  studied,  including 
their  origin  and  characteristics,  the  principles  of  in- 
cubation, feeding,  and  raising  of  chicks ;  the  care  and 
management  of  a  farm  flock  for  egg  production  and 
for  marketing;  and  the  principles  of  mating,  breed- 
ing and  judging  fowls.    In  this  line  of  work,  the  sub- 
jects of  feeds,  feeding  and  marketing  of  poultry 
products  receive  special  attention. 

(5)  Dairying.    The  dairy  work  consists  of  prac- 
tical work  and  demonstrations  in  a  milk-testing  labo- 
ratory and  a  butter-making  plant. 


156     The  Place  of  Agriculture  in  Reconstruction 

(6)  Beekeeping.  Practical  work  and  instruction 
are  given  in  the  care  and  management  of  bees,  in- 
cluding their  feeding,  swarming,  and  wintering.  The 
disabled  soldier  is  taught  how  to  extract,  store  and 
market  honey.  Special  attention  is  given  to  the  pre- 
vention and  treatment  of  bee  diseases. 

The  practical  studies  given  to  disabled  soldiers 
in  many  of  the  Canadian  agricultural  institutions 
also  include  work  on  weeds  and  weed  seeds,  diseases 
of  plants  and  their  treatment,  and  the  habits  and 
control  of  injurious  insects.  In  farm  management 
lessons  are  given  in  simple  farm  bookkeeping,  on 
cooperation  among  farmers,  the  preparation  and 
marketing  of  farm  products,  and  the  purchase  of 
farm  supplies.  In  some  institutions  courses  are 
given  in  farm  engineering,  including  studies  on  elec- 
trical equipment  and  building  construction.  In  short, 
the  aim  is  to  thoroughly  instruct  the  men  in  all  lines 
of  practical  agriculture  in  order  to  fit  them  to  suc- 
ceed in  their  chosen  occupation. 

During  the  summer  of  1918  no  less  than  216  re- 
turned disabled  soldiers  took  up  regular  courses  of 
study  in  the  several  agricultural  educational  institu- 
tions in  Canada.  The  following  table  shows  the 
number  of  men  fitted  for  the  different  lines  of  prac- 
tical farming,  the  choice  of  special  work  being  de- 
termined partly  by  the  inclination  of  the  men  them- 
selves and  partly  by  the  degree  of  their  disability: 


Land  Settlement  by  Returned  Soldiers    157 


Disabled  men  taking  agriculture  and  related  subjects  for  the  week 
ending  July  27,  1918 


No.  of 
Course  Men 

Agriculture 97 

Farm  and  gas  tractors 59 

Gardening 24 

Grain  and  seed  buying 16 

Farm  mechanics   .  .11 


Course 


No.  of 
Men 


General  farming   5 

Poultry  raising   1 

Dairying   1 

Horticulture 1 

Hog  raising 1 


3.  Elevator  agents  and  grain  buyers.  A  problem 
connected  with  the  grain-growing  branch  of  agricul- 
ture is  that  of  supplying  agents  for  the  grain  eleva- 
tor companies.  Throughout  the  three  prairie  prov- 
inces of  Manitoba,  Saskatchewan,  and  Alberta,  there 
are  about  3,200  elevators,  which  employ  roughly 
about  4,700  men.  The  call  of  the  war  has  produced 
a  scarcity  of  good  country  elevator  agents  and  grain 
buyers,  and,  with  a  view  of  determining  the  pros- 
pects of  employing  disabled  soldiers  in  this  capacity, 
an  inquiry  and  report  thereon  were  made  by  the  vo- 
cational branch  of  the  Department  of  Soldiers'  Civil 
Eeestablishment. 

The  report  on  this  inquiry  showed,  however,  that 
only  about  55  men  could  be  absorbed  in  this  line  of 
work,  and  that  previous  education,  the  training 
needed,  business  and  buying  qualifications,  and  com- 
parative freedom  from  serious  physical  and  nervous 
disabilities  would  probably  make  the  task  a  diffi- 
cult one  of  fitting  men  as  elevator  agents  from  among 
disabled  soldiers  who  might  offer  themselves  for 
training  in  this  capacity. 


158     The  Place  of  Agriculture  in  Reconstruction 

The  disabilities  which  would  disqualify  applicants 
as  elevator  agents  are  stated  to  be  men  affected  with 
lung  troubles  or  gassed  cases  on  account  of  the  dust ; 
poor  hearing  because  of  the  use  of  a  telephone ;  men 
with  bad  eyesight  as  good  eyes  are  needed  to  judge 
grain ;  no  serious  arm,  leg,  chest,  back  or  abdominal 
wounds  that  would  prevent  one  from  starting  an  en- 
gine or  moving  a  railroad  car  with  a  bar;  and  no 
serious  shell-shock,  as  such  a  person  would  be  apt  to 
fail  in  emergencies  and  also  might  not  be  able  to 
stand  the  loneliness  in  grain  elevator  localities. 

On  the  other  hand,  men  suffering  from  minor  head 
and  neck  wounds,  loss  of  one  or  two  fingers  on  either 
hand,  slight  shell-shock  or  other  disabilities  not  in- 
volving loss  of  strength  and  ability  to  move  around 
could  do  this  work. 

Notwithstanding  these  drawbacks  and  the  limited 
number  of  vacancies  that  could  be  filled  by  disabled 
soldiers  should  they  meet  the  necessary  requirements 
of  successful  grain  elevator  agents,  a  course  of  in- 
struction was  prepared  by  the  Northwest  Grain 
Dealers'  Association  by  a  committee  appointed  for 
this  purpose.  This  committee  arranged  with  a  busi- 
ness firm  to  set  up  and  install  an  elevator  scale  and 
a  gas  engine  and  to  supply  an  expert  to  deliver  at 
least  one  lecture  a  week  on  the  operation  of  both 
scale  and  engine.  In  addition  rooms  were  provided 
in  the  Grain  Exchange  for  instructing  a  class  in 
country  elevator  accounting,  grading,  and  other  work 


Land  Settlement  by  Returned  Soldiers    159 

necessary  in  the  performance  of  the  duties  of  a 
country  elevator  agent  in  the  prairie  provinces  of 
Canada.  As  these  classes  are  conducted  in  the  even- 
ing, disabled  soldiers  now  employed  may  receive  this 
instruction  after  work  hours  with  the  object  of  pro- 
curing more  remunerative  employment  if  they  give 
evidence  of  becoming  successful  elevator  agents.  The 
salaries  paid  range  from  $85  to  $120  a  month.  It  is 
recognized,  however,  that  this  field  is  very  restricted 
as  to  the  likelihood  of  its  absorbing  any  large  num- 
ber of  partially  disabled  men. 

The  Canadian  Land  Settlement  Act 

Besides  the  training  of  wounded  soldiers  for  an 
agricultural  life,  the  Dominion  of  Canada  passed 
an  act  in  August,  1917,  to  assist  returned  military 
men  to  settle  upon  the  land  for  the  purpose  of  in- 
creasing agricultural  production.  This  act  was  put 
into  operation  by  the  appointment  of  the  Soldier 
Settlement  Board,  composed  of  three  commissioners, 
in  February,  1918. 

The  passage  of  this  act  was  the  first  step  taken  by 
the  Dominion  in  dealing  with  the  general  problem 
of  land  settlement  by  returned  uninjured  soldiers 
and  sailors.  Its  purpose  is  to  aid  in  the  reinstate- 
ment of  these  men  in  civil  life,  especially  as  it  relates 
to  land  settlement  as  a  part  of  Canada's  reconstruc- 
tion program.  Certain  provisions  are  made  to  fa- 
cilitate and  encourage  those  who,  having  returned 


160     The  Place  of  'Agriculture  in  Reconstruction 

from  active  service  in  the  war,  are  desirous  to  farm 
or  are  capable  of  farming  to  take  up  free  public  land 
for  this  purpose.  They  are  expected,  however,  to 
practise  agriculture  as  their  permanent  means  of 
livelihood.  In  this  regard  land  settlement  and  pro- 
ductive farming  are  essential  to  entitle  soldier  set- 
tlers to  reap  the  benefits  of  the  act.  The  main  fea- 
tures of  this  law  are  briefly  as  follows : 

The  term  "settler"  is  stated  in  section  2  to  mean 
' '  any  person  who  has  served  in  the  naval  or  military 
expeditionary  forces  of  Canada  during  the  war,  or 
who  was  engaged  in  active  service  in  the  naval  or 
military  forces  of  the  United  Kingdom  or  of  any  of 
the  self-governing  British  dominions  or  colonies,  or 
who,  being  a  British  subject  resident  in  Canada  be- 
fore the  war,  has  been  engaged  in  active  service  at 
one  of  the  seats  of  war  in  either  the  naval  or  military 
forces  of  any  of  His  Majesty's  allies  in  the  war,  and 
who  has  left  the  forces  with  an  honorable  record  or 
who  has  been  honorably  discharged,  and  the  widow 
of  any  such  person  who  died  on  active  service." 

In  section  4  it  is  provided  that  the  Minister  of  the 
Interior,  at  the  request  of  the  Soldier  Settlement 
Board:  "  (1)  May  reserve  Dominion  lands  for  the 
purpose  of  this  act;  (2)  that  any  such  reservation 
shall  lapse  three  years  after  the  close  of  the  war; 
and  (3)  that  the  minister  may  grant  to  any  settler 
recommended  by  the  board  a  free  entry  for  not  more 
than  one  hundred  and  sixty  acres  of  such  reserved 


Land  Settlement  by  Returned  Soldiers    161 

lands,  subject  to  such  conditions  as,  in  the  opinion  of 
the  Governor-in-Council,  are  necessary  to  secure  the 
use  of  the  land  for  the  purpose  for  which  it  is 
granted/' 

Section  5  provides  that  the  board  may  loan  to  a 
settler  an  amount  not  exceeding  $2,500  for  any  of  the 
following  purposes : 

"  (1)  The  acquiring  of  land  for  agricultural  pur- 
poses; (2)  the  payment  of  incumbrances  on  lands 
used  for  agricultural  purposes;  (3)  the  improvement 
of  agricultural  land;  (4)  the  erection  of  farm  build- 
ings; (5)  the  purchase  of  live  stock,  machinery  and 
equipment;  and  (6)  such  other  purpose  or  purposes 
as  the  board  may  approve. " 

Money  loaned  is  expended  under  the  supervision 
of  the  board  and  on  the  following  conditions : 

' '  (1)  That  the  value  of  the  security  offered  is  suf- 
ficient to  justify  the  loan,  the  value  to  be  estimated 
on  the  basis  of  the  agricultural  productiveness  of  the 
land  and  the  commercial  value  of  any  other  security 
given;  and  that  the  board  is  satisfied  the  applicant 
has  the  ability  to  make  from  the  land  a  fair  living 
for  himself  and  his  family,  after  paying  the  interest 
and  amortization  charges  and  other  payments  that 
will  be  due  and  payable  with  respect  to  the  land. 

"  (2)  No  loan  shall  be  considered  except  upon  the 
written  application  of  the  borrower,  and  such  appli- 
cation shall  be  in  such  form  as  may  be  prescribed  by 


162     The  Place  of  Agriculture  in  Reconstruction 

the  board,  and  shall  set  forth  distinctly  and  definitely 
the  purpose  for  which  the  loan  is  granted. 

"(3)  An  applicant  for  a  loan  shall  furnish  such 
additional  details,  references  and  information  as  the 
board  may  at  any  time  require. 

11  (4)  All  loans  upon  Dominion  lands  shall  consti- 
tute a  first  charge  against  the  land,  and  all  loans 
upon  other  lands  shall  be  secured  by  first  mortgages, 
and  all  loans  shall  in  all  cases  bear  interest  at  the 
rate  of  five  per  cent  per  annum. 

"  (5)  Payments  of  principal  and  interest  shall  be 
made  in  equal  annual  instalments  extending  over  a 
period  of  not  more  than  twenty  years. 

"(6)  The  board  may  defer  the  payment  of  the 
whole  or  part  of  the  first  two  instalments  to  such 
later  date  as  it  may  deem  expedient,  such  deferred 
payments  to  continue  to  bear  interest  at  the  rate 
aforesaid. 

' '  (7)  The  settler  may  at  any  time  pay  to  the  board 
the  whole  or  any  part  of  the  money  borrowed,  with 
interest.  Interest  shall  be  payable  up  to  the  date  of 
such  payment. 

61  (8)  When  a  loan  has  been  made  upon  Dominion 
lands,  no  patent  shall  issue  until  the  loan  and  all  in- 
terest thereon  have  been  paid  in  full." 

For  the  instruction  of  returned  soldiers,  their 
wives,  and  female  dependents  in  the  principles  of 
farming  before  being  allowed  to  settle  on  the  land, 
the  following  provisions  are  included  in  the  act : 


Land  Settlement  by  Returned  Soldiers    163 

The  board  may  (1)  place  returned  soldiers  with 
fanners  in  order  that  they  may  be  instructed  in 
farming;  (2)  may  make  provision  for  agricultural 
training  stations  for  returned  soldiers;  (3)  may  pro- 
vide for  farm  instructors  and  inspectors  to  assist 
settlers  with  information  and  instruction  in  farm- 
ing; and  (4)  may  provide  training  in  domestic  and 
household  science  for  settlers'  wives  and  female 
dependents. 

The  act  also  authorizes  the  board,  with  the  ap- 
proval of  the  Governor-in-Council,  to  make  regula- 
tions prescribing  the  manner  in  which  entries  for 
land  and  applications  for  loans  may  be  made;  how 
free  entries  and  patents  for  land  may  be  granted  and 
issued ;  the  security  for  loans,  the  conditions  under 
which  they  shall  be  made,  and  their  method  of  re- 
payment, and  the  manner  and  conditions  upon  which 
settlers  may  transfer  their  rights. 

These  are  the  chief  provisions  of  the  Canadian 
Land  Settlement  Act.  They  cover  all  three  phases 
of  land,  labor  and  capital  in  their  relation  to  increas- 
ing agricultural  production.  Let  us  see,  therefore, 
to  what  extent  the  law  and  the  regulations  of  the 
Soldier  Settlement  Board  have  been  carried  out  and 
how  they  tend  to  promote  successful  farming  opera- 
tions by  returned  soldiers  and  sailors  in  Canada. 


164     The  Place  of  Agriculture  in  Reconstruction 

Free  Land  for  Settlement 

At  the  time  the  Soldier  Settlement  Act  was  passed 
Canada  had  a  large  extent  of  public  land,  particu- 
larly in  the  three  prairie  provinces  of  Manitoba, 
Saskatchewan  and  Alberta,  that  was  suitable  for 
settlement  and  for  productive  agriculture.  The  act, 
therefore,  provides:  (1)  That  the  Minister  of  the 
Interior  may  reserve  such  Dominion  lands  for  the 
purposes  of  land  settlement  by  soldiers  at  the  request 
of  the  Soldier  Settlement  Board;  (2)  that  any  such 
reservation  shall  lapse  three  years  after  the  close 
of  the  war;  and  (3)  that  he  may  grant  to  any  set- 
tler recommended  by  the  board  a  free  entry  for  not 
more  than  one  hundred  and  sixty  acres  of  such  re- 
served lands. 

In  accordance  with  the  policy  thus  authorized  by 
the  act,  the  Soldier  Settlement  Board  promptly  af- 
ter its  appointment  requested  the  Minister  of  the 
Interior  to  reserve  all  remaining  Dominion  lands 
within  a  reasonable  distance  of  railway  transporta- 
tion for  the  purpose  of  settling  returned  soldiers  and 
sailors  thereon.  Consequently,  full  steps  were  taken 
to  secure  to  returned  ex-service  men  the  best  free 
homestead  lands  still  remaining  that  were  suitable 
for  settlement.  Furthermore,  in  the  case  of  a  re- 
turned soldier  who  already  held  a  homestead,  pro- 
vision was  made  that  the  adjoining  quarter-section 


Land  Settlement  by  Returned  Soldiers    165 

of  160  acres  should  be  reserved  for  him  if  he  made 
such  a  request. 

There  being  no  definite  data  on  hand  as  to  the 
amount  of  Dominion  land  that  could  thus  be  granted 
for  settlement  purposes,  investigations  were  also 
immediately  set  on  foot  to  determine  to  what  extent 
the  remaining  free  Dominion  lands  would  assist  in 
solving  the  problem  of  land  settlement  by  ex-service 
men.  Until  the  desired  information  has  been  ac- 
quired, however,  there  is  no  assurance  that  all  who 
apply  will  be  able  to  receive  a  free  grant  of  160  acres 
of  land  which  can  be  profitably  cultivated. 

In  view  of  this  fact,  certain  land  regulations  were 
drawn  up  by  the  Soldier  Settlement  Board,  which 
were  approved  by  the  Governor-in-Council  on  May 
14, 1918.  After  due  advertisement  July  2,  1918,  was 
fixed  as  the  effective  date  of  the  regulations  for  the 
granting  of  entries  to  returned  soldiers  applying  for 
free  land  at  the  Dominion  land  agencies  in  the  west- 
ern provinces. 

At  the  outbreak  t)f  the  war  it  had  been  decreed 
that  any  one  who  held  Dominion  land  under  entry 
as  a  homestead,  preemption,  or  purchased  home- 
stead would  be  protected  in  his  entry  while  on  active 
service  in  the  naval  or  military  forces.  Among  the 
regulations  for  putting  into  effect  the  provisions  of 
the  Soldier  Settlement  Act,  it  was  provided  that  any 
returned  soldier  holding  such  an  entry  or  who  might 
enter  for  free  Dominion  land,  if  eligible  to  obtain  a 


166     The  Place  of  Agriculture  in  Reconstruction 

loan  under  the  act,  may  do  so  on  the  security  of  the 
land  thus  entered  for  on  the  same  terms  and  condi- 
tions as  if  the  land  were  already  privately  owned. 
The  amount  of  the  loan  that  might  be  granted  is 
based  on  the  productive  value  of  the  land  for  agri- 
cultural purposes. 

To  further  insure  the  success  of  a  soldier's  farm- 
ing operations,  any  one  who  had  already  taken  up  a 
homestead  on  free  Dominion  land  was  eligible  to  se- 
cure a  free  entry  for  another  160  acres  on  what  are 
practically  the  same  settlement  duties  as  for  a 
civilian  homestead.  A  returned  soldier  thus  entitled 
to  both  civilian  and  soldier  entries  may  take  up  two 
quarter-sections  adjoining,  making  a  total  of  320 
acres  of  free  land.  Eight  of  entry  for  the  soldier 
grant  may  be  exercised  on  any  vacant  and  available 
Dominion  lands,  the  same  as  with  ordinary  home- 
stead entries,  by  application  to  an  agent  or  sub-agent 
of  such  lands.  Attestation  by  the  Soldier  Settlement 
Board  that  the  applicant  is  eligible  as  a  settler  must 
be  produced  at  the  time  the  application  is  made.  At 
the  request  of  the  board,  all  vacant  Dominion  lands 
within  fifteen  miles  of  the  railways  in  the  northern 
part  of  the  province  of  Alberta  were  specifically  re- 
served by  the  Minister  of  the  Interior  for  soldier 
entries.  Elsewhere  in  the  three  prairie  provinces 
of  Manitoba,  Saskatchewan  and  Alberta  the  agents 
of  Dominion  lands  were  instructed  to  select  and  re- 
serve for  returned  ex-service  men  the  remaining  Do- 


Land  Settlement  by  Returned  Soldiers    167 

minion  lands  within  fifteen  miles  of  transportation 
of  a  quality  thought  suitable  for  soldier  settlement 
and  profitable  farming.  These  are  known  as  ' '  selec- 
tion reservations. "  The  lands  are  withheld  from 
other  persons  at  present  in  order  that  returned  sol- 
diers might  have  first  choice  in  the  selection  of  land 
offering  the  promise  of  profitable  cultivation.  In 
the  case  of  Dominion  lands  thus  reserved  for  soldiers 
such  matters  as  determining  the  classes  of  lands 
open  to  entry,  granting  of  entries,  the  performance 
of  duties,  and  applying  for  patents  are  carried  on 
by  the  Department  of  the  Interior  through  the  vari- 
ous Dominion  land  agencies  the  same  as  in  ordinary 
homestead  entries. 

That  the  demand  for  such  lands  will  be  large  when 
the  Canadian  soldiers  have  all  returned  from  Eu- 
rope is  shown  by  the  fact  that  during  the  first  week 
of  July,  1918,  when  the  entries  were  first  opened,  no 
less  than  181  returned  soldiers  secured  soldier  grant 
entries  at  the  various  agencies.  Of  this  number  156 
also  held  homestead  entries,  making  a  total  of  337 
quarter-sections  or  about  28,000  acres.  If  this  ratio 
should  continue  for  the  three  years  during  which  the 
reservation  of  lands  is  to  last,  it  is  doubtful  if  there 
will  be  sufficient  free  land  of  good  quality  to  give 
every  soldier  a  farm,  much  less  a  quarter-section, 
who  might  apply  for  it.  What  the  solution  of  the 
land  settlement  problem  in  Canada  would  be  under 
those  circumstances  it  is  difficult  to  foresee. 


168     The  Place  of  Agriculture  in  Reconstruction 

In  connection  with  the  free  Dominion  lands  opened 
for  soldier  settlement  in  the  three  western  prairie 
provinces,  there  has  been  considerable  cooperation 
with  the  older  and  more  densely  populated  eastern 
provinces  to  encourage  land  settlement.  These 
provinces  own  and  control  the  government  lands 
within  their  borders. 

Before  the  commencement  of  the  war,  the  three 
provinces  of  New  Brunswick,  Nova  Scotia  and  Prince 
Edward  Island  had  passed  legislation  looking  to 
farm  settlement  and  increased  agricultural  produc- 
tion. In  Ontario,  Quebec  and  the  extreme  western 
province  of  British  Columbia  legislation  has  been 
passed  or  other  measures  have  been  taken  since  the 
commencement  of  the  war  with  special  reference  to 
land  settlement  by  soldiers.  In  this  matter  arrange- 
ments are  being  made  by  the  Dominion  government 
to  cooperate  with  the  various  provinces  to  prevent 
the  overlapping  of  powers,  functions  and  purposes. 
In  providing  government  aid  to  further  provincial 
plans  and  policies  of  soldier  settlement  it  is  recog- 
nized that  the  fundamental  principle  of  the  Do- 
minion constitution  places  the  control  of  patented 
lands,  civil  rights  and  local  administration  in  the 
provinces. 

Another  cooperative  factor  of  successful  land  set- 
tlement is  the  special  transportation  rates  granted 
by  the  railroad  companies  of  Canada  as  a  means  of 


Land  Settlement  by  Returned  Soldiers    169 

assisting  returned  soldiers  to  settle  upon  the  free 
provincial  and  government  lands. 

After  several  conferences  between  the  govern- 
ment and  the  railroads,  the  low  rate  of  one  cent  a 
mile  was  granted.  This  rate  applies  equally  to  the 
soldier's  first  trip  to  work  with  a  farmer,  to  attend 
an  agricultural  educational  institution,  or  to  look  for 
land.  It  also  applies  in  case  the  soldier,  after  select- 
ing his  farm  location,  has  to  return  to  his  home 
destination  to  bring  back  his  goods  and  his  family. 
The  same  rate  is  also  allowed  to  the  adult  members 
of  his  family  who  journey  with  him  back  to  the  farm. 
Children  between  twelve  and  five  years  of  age  are 
charged  half  this  low  rate,  while  those  under  five 
travel  free. 

To  take  advantage  of  this  low  rate  of  transporta- 
tion, the  returned  soldier  has  to  procure  from  the 
Soldier  Settlement  Board  or  its  authorized  repre- 
sentative a  certificate  stating  that  the  holder  is  a 
settler  and  entitled  to  receive  such  rate.  As  there 
are  formalities  to  be  gone  through  in  complying  with 
the  regulations  of  the  railroads  and  in  ascertaining 
necessary  military  records,  applicants  are  warned  to 
apply  for  their  certificate  well  ahead  of  the  time  they 
contemplate  commencing  their  trip. 

Canadian  Soldiers  as  Farmers 

For  the  present  and  for  some  time  to  come,  there 
is  not  much  likelihood  that  the  land  problem  for 


170     The  Place  of  Agriculture  in  Reconstruction 

soldiers  will  give  the  Dominion  government  any 
grave  concern.  We  can  pass  on,  therefore,  to  a  con- 
sideration of  the  labor  factor  in  agricultural  produc- 
tion and  what  the  law  provides  for  meeting  the 
situation. 

Under  the  Soldier  Settlement  Act,  the  following 
persons  are  entitled  to  apply  for  land  and  a  loan: 

(1)  Any  person  who  has  served  in  the  naval  or 
military  expeditionary  forces  of  Canada  during  the 
Great  European  War. 

(2)  Any  person  who  has  been  engaged  in  active 
service  during  the  war  in  the  naval  or  military  forces 
of  the  United  Kingdom  or  any  of  the  self-governing 
British  dominions  or  colonies. 

(3)  Any  person  who,  being  a  British  subject  resi- 
dent in  Canada  before  the  war,  has  been  in  active 
service  in  either  the  naval  or  military  forces  of  any 
of  the  allies. 

(4)  The  widow  of  any  such  person  described  above 
who  has  died  on  active  service. 

It  is  a  necessary  condition  to  eligibility  to  the  bene- 
fits of  this  act  that  any  soldier  applicant  has  either 
left  the  service  with  an  honorable  record  or  has  been 
honorably  discharged. 

But  the  regulations  of  the  board  require  that  the 
applicant  shall  have  satisfactory  farming  qualifica- 
tions. In  other  words,  the  settler  must  have  the 
necessary  knowledge  and  fitness  to  farm.  It  is  recog- 
nized that  ability  to  farm  is  as  essential  to  the  sue- 


Land  Settlement  by  Returned  Soldiers    171 

cess  of  the  settler  as  the  agricultural  productiveness 
of  the  land  he  expects  to  cultivate.  If  he  has  not 
previously  followed  the  occupation  of  farming,  he 
may  secure  the  necessary  training  and  experience 
by  engaging  in  agricultural  work  with  practical 
farmers  or  in  other  ways.  His  application  for  land 
and  a  loan  will  only  be  considered  when  in  the  judg- 
ment of  the  board  he  is  qualified  to  farm  success- 
fully. Arrangements  have  been  made  to  assist  in 
the  agricultural  training  of  returned  soldiers. 

The  course  of  education  for  men  inexperienced  in 
farming  consists :  (1)  In  placing  returned  soldiers 
with  farmers  in  order  that  they  may  be  instructed  in 
farming;  (2)  in  providing  agricultural  training  sta- 
tions for  ex-service  men;  (3)  in  directing  farm  in- 
structors and  inspectors  to  assist  settlers  with  in- 
formation and  instruction  in  farming;  and  (4)  in 
providing  means  for  the  training  of  settlers'  wives 
.and  their  female  dependents  in  domestic  science  and 
household  economy. 

There  can  be  no  question,  therefore,  that  in  these 
various  ways  the  supply  of  agricultural  labor  in 
Canada  will  not  only  be  abundant,  but  it  will  be  effi- 
cient. In  fact,  the  regulations  are  such  that  only  men 
capable  of  carrying  on  farming  successfully  will  be 
encouraged  to  take  up  land  for  this  purpose.  There 
is  not  the  slightest  doubt  about  Canadian  soldiers  be- 
coming practical  and  efficient  farmers  under  the  care 
exercised  in  their  selection  and  the  training  given 


172     The  Place  of  Agriculture  in  Reconstruction 

them  before  they  are  permitted  to  become  actual  set- 
tlers. For  these  reasons  the  farm  labor  problem  is 
likely  to  offer  little  or  no  difficulty  in  the  way  of  es- 
tablishing a  successful  land  settlement  scheme  for 
soldiers  and  sailors  in  Canada. 

Credit  Conditions  for  Soldiers 

In  order  to  carry  out  the  provisions  of  the  Soldier 
Settlement  Act,  the  sum  of  $2,916,000  was  appro- 
priated by  Parliament  for  this  purpose.  One  of  its 
main  features  is  the  credit  provision  to  aid  the  re- 
turned soldier  who  takes  up  farming  as  his  future 
occupation  by  granting  him  a  long-time  loan  at  a 
cheap  rate  of  interest,  with  the  first  two  payments 
deferable.  This  loan  provision  applies  to  all  prov- 
inces of  the  Dominion  and  is  designed  to  provide  a 
measure  of  financial  assistance  to  settlers  during  the 
first  years  of  their  farming  experience.  As  previ- 
ously pointed  out,  in  the  case  of  returned  soldiers 
settling  on  free  homestead  lands,  the  loan  provision 
also  applies  on  the  same  terms  as  if  the  lands  were 
privately  owned.  Moreover,  besides  the  ordinary 
right  of  homestead  entry  open  to  civilians,  an  addi- 
tional 160  acres  may  be  granted  a  returned  soldier 
under  entry  on  suitable  settlement  terms. 

The  purposes  of  loans  provided  by  the  Soldier 
Settlement  Act  very  closely  follow  those  of  the  Fed- 
eral Farm  Loan  Act  in  the  United  States.  All  loans 
bear  interest  at  5  per  cent  a  year,  the  payment  of 


Land  Settlement  by  Returned  Soldiers    178 

principal  and  interest  being  made  in  equal  annual 
instalments  extending  over  a  period  not  exceeding 
20  years,  and  for  any  of  the  following  purposes : 

(1)  To  acquire  land  for  agricultural  uses;  (2)  to 
pay  off  incumbrances  on  farm  land;  (3)  to  make  im- 
provements on  agricultural  land;  (4)  to  erect  farm 
buildings;  (5)  to  purchase  live  stock,  machinery  and 
equipment;  and  (6)  for  such  other  purposes  as  the 
Soldier  Settlement  Board  may  approve. 

Advances  of  money  are  not  made  directly  to  the 
settler  in  cash,  but  in  the  form  of  payments  for  ma- 
terial, equipment,  improvements  or  any  other  of  the 
above  named  purposes  desired  by  the  settler,  so  that 
all  money  loaned  to  returned  soldiers  is  expended 
under  the  supervision  of  the  board. 

A  certain  flexibility  is  given  to  this  act  because 
no  rigid  ratio  is  set  up  between  the  value  of  the 
security  and  the  amount  of  the  loan.  It  is  provided 
that  the  maximum  sum  which  can  be  loaned  to  a 
settler  is  $2,500.  In  making  any  loan  it  is  provided 
that  the  Soldier  Settlement  Board  must  be  satisfied 
that  the  value  of  the  security  offered  is  sufficient  to 
justify  the  amount  of  the  loan.  The  value  of  the  land 
as  security  will  be  determined  by  the  board  by  in- 
spection and  appraisal. 

In  determining  the  amount  which  may  be  loaned 
on  any  farm  three  things  are  taken  into  considera- 
tion: (1)  The  agricultural  productiveness  of  the 
land;  (2)  the  commercial  value  of  any  other  security 


The  Place  of  Agriculture  in  'Reconstruction 

given;  and  (3)  the  ability  of  applicant  to  make  from 
the  land  a  fair  living  for  himself  and  family,  after 
making  all  interest  and  other  payments  which  may 
become  due  on  his  loan. 

The  amount  which  may  thus  be  loaned  to  any  sol- 
dier settler  will  in  every  case  be  dependent  upon  the 
value  of  the  security  given,  but  is  based  primarily 
upon  the  judgment  of  the  Soldier  Settlement  Board. 
Thus,  if  an  applicant  owned  an  unencumbered  farm 
valued  at  $2,400,  the  board  might  authorize  a  loan 
thereon  of  $1,400,  $1,600,  or  even  a  larger  sum  if 
other  conditions  proved  satisfactory.  It  is  this  flexi- 
bility which  is  unique  in  the  Canadian  system  of 
financing  land  settlement  by  soldiers  and  sailors. 

First  mortgage  security  must  be  given  for  all  loans 
on  privately-owned  lands.  Also  all  loans  on  Do- 
minion lands  shall  constitute  a  first  lien  thereon. 
But  no  loans  can  be  made  on  a  leasehold,  on  an  agree- 
ment to  sell,  or  on  any  other  limited  title. 

The  Soldier  Settlement  Act  provides  that  a  settler 
may  postpone  the  payment  of  the  whole  or  part  of 
the  first  two  instalments  on  his  loan  to  such  later 
date  as  the  board  may  deem  expedient.  In  that  case, 
such  deferred  payments  will  continue  to  bear  interest 
at  the  designated  rate  of  5  per  cent.  On  the  other 
hand,  a  settler  may  pay  the  whole  or  any  part  of  his 
loan  with  interest  at  any  time,  the  interest  being 
payable  up  to  the  date  of  such  payment. 


Land  Settlement  by  Returned  Soldiers    175 

Method  of  Obtaining  a  Loan 

The  loan  privileges  of  the  Soldier  Settlement  Act 
went  into  effect  when  the  Governor-in-Council  ap- 
proved the  loan  regulations  of  the  board  on  April  5, 
1918.  It  was  necessary  to  prepare  regulations, 
methods  of  procedure,  and  organization  in  order  to 
carry  on  the  loan  administration  satisfactorily.  Con- 
sequently, offices  were  opened  in  each  province,  land 
appraisers  were  appointed  to  make  the  appraise- 
ments in  each  case,  and  solicitors  were  employed  to 
examine  titles  and  prepare  the  necessary  documents. 
The  charges  for  these  services  were  at  the  expense 
of  the  Soldier  Settlement  Board  and  not  of  the  bor- 
rower. 

Applications  for  loans  are  considered  by  advisory 
councils  in  each  province.  These  councils  are  com- 
posed of  the  best  farmers  in  each  community,  who  act 
in  an  honorary  capacity.  It  is  their  duty  to  see  that 
the  application  of  each  soldier  for  a  loan  is  justly 
and  impartially  considered  in  accordance  with  the 
merits  of  the  case  and  the  requirements  of  the  act. 
Moreover,  the  provincial  office  and  its  advisory  coun- 
cil study  the  best  methods  by  which  the  loan  pro- 
visions may  be  used,  not  only  to  assist  returned  sol- 
diers to  establish  themselves  on  the  land,  but  also  to 
meet  in  the  best  way  the  special  needs  and  conditions 
of  each  particular  province.  That  is,  the  soldier  ap- 
plicant is  aided  and  encouraged  to  practise  a  type 


176     The  Place  of  Agriculture  in  Reconstruction 

of  farming  or  stock  raising  which  is  likely  to  become 
most  successful  in  the  different  provinces  of  the  Do- 
minion. In  this  way  the  soldier  settler  is  expected 
to  improve  his  economic  condition  and  to  increase 
the  agricultural  wealth  of  the  province. 

In  the  matter  of  obtaining  a  loan,  certain  prelimi- 
nary information  is  necessary.  It  is  to  be  noted  par- 
ticularly that  no  application  for  land  or  a  loan  can 
be  made  until  the  soldier  or  sailor  is  demobilized. 

The  first  step  of  a  returned  soldier  in  procuring 
a  loan  is  to  apply  to  the  Soldier  Settlement  Board 
or  any  of  its  local  representatives,  which  are  ap- 
pointed in  each  province  of  the  Dominion,  for  a  pre- 
liminary information  form.  In  filling  out  this  blank 
form  the  applicant  provides  the  board  with  informa- 
tion covering  his  military  or  naval  rank,  regimental 
number,  service  overseas,  occupation  before  enlist- 
ment, previous  farming  experience,  and  his  fitness 
for  land  settlement.  On  receiving  this  information, 
the  case  is  referred  to  the  Militia  Department  of 
Canada  for  a  report  on  the  applicant 's  military  rec- 
ord. If  this  report  shows  him  to  be  eligible  as  a 
settler  within  the  meaning  of  the  act,  he  is  given 
a  certificate  of  attestation  affirming  his  right  to  a 
loan.  The  prospective  soldier  settler  may  then  make 
a  formal  application  for  a  loan  before  a  representa- 
tive of  the  board,  in  which  he  specifies  the  purposes 
for  which  the  loan  is  to  be  expended,  gives  full  par- 
ticulars concerning  the  land  offered  as  security,  and 


Land  Settlement  by  Returned  Soldiers     177 

furnishes  such  other  details,  references  and  infor- 
mation as  may  be  required.  With  this  information 
in  its  possession,  the  board  has  the  value  of  the 
property  appraised  and  the  title  examined  by  its 
solicitor. 

After  the  approval  of  a  loan  and  completion  of  the 
documents,  the  board  issues  warrants  to  the  vendor 
named  by  the  settler  for  the  expenditure  of  the 
money  for  the  purposes  designated.  But  the  entire 
sum  for  which  a  loan  is  approved  is  not  necessarily 
advanced  to  the  borrower  at  one  time.  The  appli- 
cant's financial  condition  and  existing  needs  are 
carefully  considered  and  such  initial  advances  of 
funds  are  authorized  as  are  deemed  advisable.  Then, 
as  the  settler  progresses  with  his  improvements  and 
increases  the  value  of  his  holding,  further  advances 
are  made  from  time  to  time  until  he  has  received  the 
total  amount  of  his  loan. 

In  carrying  out  the  act  and  the  board's  regula- 
tions, the  cases  requiring  immediate  attention  were 
first  given  consideration.  The  applications  for  loans 
by  returned  soldiers  who  had  farms  before  they  went 
to  war  and  who  were  desirous  of  renewing  their 
farming  operations  without  delay  were  first  con- 
sidered and  approved.  Applications  for  loans  are 
now  being  examined  in  all  provinces  of  the  Do- 
minion. By  July  15, 1918,  or  three  months  after  the 
board's  regulations  had  gone  into  effect,  no  less  than 
606  applications  for  loans  by  soldier  settlers  who  had 


178     The  Place  of  Agriculture  in  Reconstruction 

complied  with  the  requirements  of  the  act  had  been 
approved  for  a  total  of  $690,800. 

Analysis  of  Canada's  Land  Settlement  Problem 

For  the  immediate  needs  of  the  Dominion's  agri- 
cultural requirements,  land  and  labor  seem  to  be 
abundant.  At  present  there  is  enough  free  govern- 
ment land  to  give  a  farm  of  160  acres  to  every  dis- 
charged soldier  and  sailor  who  wishes  to  engage  in 
farming  for  a  living.  It  may  also  prove  to  be  the 
case  that  there  will  be  no  lack  of  land  when  de- 
mobilization of  the  naval  and  military  forces  of  the 
Dominion  has  been  completed.  Under  any  circum- 
stances it  is  the  government's  plain  intention  to  put 
land  settlement  on  a  sound  basis  by  exercising  super- 
vision over  both  land  and  labor.  If  an  applicant 
has  no  land  it  will  be  given  to  him ;  and  if  he  has  had 
no  farming  experience,  he  will  be  instructed  in  the 
principles  of  farming  until  he  is  fitted  to  operate  a 
farm  successfully  on  his  own  initiative.  From  the 
viewpoint  of  land  and  labor,  Canada's  scheme  of 
land  settlement  by  ex-service  men  is  not  likely  to 
fail. 

But  most  of  the  land  in  the  eastern  provinces  of 
the  Dominion  lie  north  of  the  forty-fifth  parallel  of 
latitude,  while  the  free  land  open  for  settlement  in 
the  three  western  prairie  provinces  of  Manitoba,  Sas- 
katchewan and  Alberta,  as  well  as  in  the  extreme 
northwestern  province  of  British  Columbia,  lie  north* 


Land  Settlement  by  Returned  Soldiers    179 

of  the  fiftieth  parallel.  The  severe  climatic  condi- 
tions which  prevail  in  those  parts  of  North  America 
not  only  limit  the  scope  of  garden,  farm  and  live- 
stock production,  but  they  render  more  precarious 
these  various  lines  of  the  agricultural  industry.  If 
these  severe  climatic  conditions  are  not  offset  by 
easy  terms  and  conditions  of  loans  to  settlers,  the 
prospects  of  success  will  not  be  promising  notwith- 
standing the  extensive  free  gifts  of  land  by  a  gener- 
ous government.1 

Under  the  Canadian  scheme  of  land  settlement  by 
soldiers,  loans  can  not  exceed  $2,500  in  amount,  are 
made  at  5  per  cent  interest,  and  are  repayable  in  20 
years.  These  terms  and  conditions  do  not  compare 
favorably  with  those  of  the  federal  farm  loan  system 
in  the  United  States,  which  were  provided  primarily 
to  encourage  agricultural  development  by  already 
established  farmers.  Under  this  system  loans  may 
be  made  for  $10,000  and  for  periods  of  time  ranging 
from  5  to  40  years.  The  rate  of  interest  was  first 
established  at  5  per  cent,  the  same  as  that  of  the 
Canadian  Soldier  Settlement  Act,  but  was  raised  to 
5%  per  cent  in  December,  1917,  as  a  result  of  finan- 
cial conditions  which  prevailed  after  the  United 
States  had  entered  into  the  European  conflict. 

The  difference  of  %  of  1  Per  cent,  however,  in  the 
rate  of  interest  is  more  than  compensated  by  double 

1For  a  more  detailed  account  of  the  results  of  investigations  on 
available  government  lands  in  Canada  and  the  problem  now  created, 
see  Chapter  IX  under  the  subdivision  entitled  ' '  A  New  Land  Policy. '  * 


180     The  Place  of  Agriculture  in  Reconstruction 

the  period  of  a  loan  and  four  times  its  amount  which 
are  afforded  under  our  farm  loan  system.  Moreover, 
land  settlers  in  Canada  are  not  established  farmers, 
the  majority  of  them  being  returned  soldiers  without 
any  previous  farming  experience  and  with  little  or 
no  accumulation  of  capital.  The  climatic  and  the 
loan  conditions  together  will  doubtless  render  the  lot 
of  the  average  soldier  settler  a  hazardous  one.  These 
seem  to  be  the  only  weak  features  of  the  Canadian 
land  settlement  scheme  for  ex-service  men.  If  suc- 
cess finally  crowns  the  efforts  of  these  soldier  set- 
tlers it  will  be  in  spite  of  these  conditions  and  not 
because  of  them.  But  when,  after  a  few  years  of 
trial,  the  facts  concerning  the  Dominion's  scheme  of 
land  settlement  for  returned  soldiers  and  sailors 
have  been  fully  recorded  as  a  matter  of  history,  if 
more  settlers  fail  than  succeed  it  will  be  because  the 
rate  of  interest  on  loans  was  too  high,  the  amount 
of  a  loan  too  low,  and  the  period  of  loans  too  short 
to  make  success  possible  under  the  severe  climatic 
conditions  of  North  America  which  render  agricul- 
ture exceedingly  precarious  under  the  best  condi- 
tions of  land,  labor  and  capital. 


CHAPTER  VIII.— LAND  SETTLEMENT  FOE 
SOLDIERS  IN  THE  UNITED  STATES 

We  now  come  to  our  own  country.  What  oppor- 
tunity presents  itself  to  the  United  States  in  view  of 
reconstruction  problems  in  European  countries! 
What  has  been  done  or  what  is  proposed  to  be  done 
in  the  way  of  settling  soldiers  on  the  land  and  for 
increasing  agricultural  production?  And,  lastly, 
what  scheme  of  land  settlement  for  soldiers  should 
be  advocated  as  a  result  of  our  review  of  national 
programs  of  reconstruction?  These  are  some  of  the 
questions  which  press  for  answer  during  the  course 
of  demobilization  of  the  surplus  military  and  naval 
forces  of  our  country,  the  results  of  which  will  af- 
fect our  economic  prosperity  and  social  welfare  for 
many  years  to  come. 

Let  us  endeavor,  then,  to  ascertain  our  opportuni- 
ties and  face  our  problems  as  they  relate  to  the  great 
national  industry  of  agriculture.  Never  before  in 
the  history  of  the  world  has  any  nation  seemed  so 
favored  as  the  United  States  with  opportunities  and 
resources  for  promoting  our  own  welfare,  for  financ- 
ing the  reconstruction  of  devastated  countries,  and 
for  aiding  in  the  economic  and  social  uplift  of  long- 
suffering  humanity. 

181 


182     The  Place  of  Agriculture  in  Reconstruction 

The  Danger  of  Unemployment 

The  place  of  agriculture  in  reconstruction  is  pri- 
marily to  provide,  as  promptly  and  as  abundantly 
as  possible,  food  for  the  people  and  the  raw  materials 
for  many  industries.  There  is  no  time  for  experi- 
ments in  ideal  land  settlement  schemes.  There  is 
danger  of  unemployment,  for  thousands  of  soldiers 
are  being  demobilized  weekly  from  our  camps,  thus 
being  let  loose  on  the  labor  market  under  abnormal 
conditions.  War-time  industrial  plants  are  being 
closed  down  because  of  the  cancellation  of  military 
contracts,  which  throws  out  of  employment  many 
thousands  of  workers.  Manufacturers  of  food  prod- 
ucts  and  textile  goods  are  unable  and  unwilling  to 
absorb  these  discharged  industrial  labor  forces,  be- 
cause of  their  lack  of  experience,  a  scarcity  of  raw 
materials,  the  uncertainties  of  taxation,  and  the  high 
price  of  credit. 

Demobilized  soldiers  and  sailors  add  to  the  stream 
of  unemployed  labor.  In  an  address  before  the 
American  Academy  of  Social  and  Political  Science  at 
New  York  in  December,  1918,  Mr.  Nathan  A.  Smith, 
assistant  director-general  of  the  United  States  Em- 
ployment Service,  said : 

"Soldiers  are  being  discharged  by  the  thousands 
daily  on  the  basis  of  military  units,  with  no  refer- 
ence to  whether  or  not  they  are  now  needed  in  in- 
dustry. They  are  being  mustered  out  on  a  few  days ' 


Land  Settlement—United  States         183 

notice  and  given  in  money  the  cost  of  transportation 
to  their  homes,  free  to  buy  tickets  wherever  they 
please.  Already  they  are  turning  up  in  the  cities, 
improvident, i broke,'  away  from  home  without  work, 
applicants  for  civilian  relief.  Many  others  are  un- 
willing to  undertake  the  day-labor  jobs  which  alone 
they  can  find.  There  is  every  prospect  that  unless 
remedial  measures  are  promptly  taken  the  sight  of 
stranded,  workless,  moneyless  soldiers  will  be  com- 
mon throughout  the  land. 

"The  great  danger  is  that  there  won't  be  jobs 
enough  to  go  around ;  that  unemployment  will  come 
with  attendant  misery  and  social  unrest  at  a  time 
when  anarchistic  tendencies  are  contagious. 

'  '  The  remedy  of  building  public  works  is  not  avail- 
able on  a  large  scale  until  spring.  The  farms  will 
not  call  urgently  for  men  until  frost  thaws  out. 
Chiefly  must  we  look  to  our  manufacturers  to  carry 
the  burden.  But  they  are  hesitant.  Taxes  are  not 
yet  determined.  The  cost  of  money  is  high  and 
credit  timid  for  a  while.  The  prices  of  raw  ma- 
terial and  labor  are  high.  The  producer  hopes  they 
will  fall  and  manifests  a  tendency  to  wait  till  they  do. 
To  meet  each  of  these  deterrent  features  is  an  im- 
mediate national  task." 

If,  then,  a  practical  program  of  land  settlement  is 
contemplated,  it  should  aim  to  bring  into  use  with- 
out delay  all  land  that  offers  the  prospect  of  profit- 
able cultivation.  Drainage  and  irrigation  projects 


184     The  Place  of  Agriculture  in  Reconstruction 

involving  heavy  cost  and  a  long  period  of  time  should 
wait  until  land  now  held  out  of  use  is  brought  under 
the  plow.  There  are  millions  of  acres  of  land  that 
could  thus  be  used  for  the  absorption  of  unemployed 
labor  under  a  rational  governmental  system  of  land 
settlement  for  soldiers. 

Climate  and  Land  Areas 

From  an  agricultural  point  of  view,  the  United 
States  is  highly  favored  as  to  climate  and  land 
areas.  Lying  between  the  twenty-fifth  and  forty- 
eighth  parallels  of  latitude,  the  country  enjoys  de- 
grees of  climate  varying  from  temperate  to  semi- 
tropical.  Not  only  can  the  greatest  variety  of  crops 
be  grown,  but  agriculture  can  be  practised  in  some 
parts  of  the  country  every  month  of  the  year.  Taken 
as  a  whole  no  country  in  the  world  is  more  favored 
in  its  climatic  conditions  for  the  production  of  foods, 
both  vegetable  and  animal,  and  the  raw  materials  of 
many  industries.  Its  land  areas  are  so  extensive 
that  it  can  easily  produce  not  only  all  our  own  needs 
in  foods  and  raw  materials,  but  a  large  surplus  for 
less-favored  nations.  The  outlook  for  farming  and 
live  stock  raising  in  the  United  States  is  not  sur- 
passed by  any  other  nation  on  the  globe. 

The  land  area  in  farms  and  capable  of  being 
farmed  in  1910  amounted  to  1,903,289,600  acres.  This 
land  area  was  actually  less  by  172,160  acres  than  it 
was  in  1900,  notwithstanding  the  increase  in  area  due 


Land  Settlement — United  States         185 

to  the  drainage  of  lakes  and  swamps  in  Illinois  and 
Indiana.  The  decrease  in  land  area  was  the  result 
of  building  the  Roosevelt  and  Laguna  reservoirs  for 
irrigation  purposes  and  the  formation  of  the  Salton 
Sea  in  California.  While  the  actual  land  area  that 
could  be  used  for  farming  and  stock  raising  was 
thereby  decreased,  the  outlook  for  agricultural  pro- 
duction was  greatly  improved  because  of  the  oppor- 
tunities thus  afforded  for  irrigating  large  tracts  of 
land  and  making  them  more  productive  than  the  in- 
creased acreage  would  have  been  without  a  water 
supply. 

Of  the  total  acreage  in  the  United  States,  only 
878,798,325  acres,  or  much  less  than  one-half,  are 
now  in  farms,  and  of  the  farm-land  area  only  478,- 
451,750  acres,  or  54.4  per  cent,  of  the  land  in  farms 
are  improved.  There  is  a  vast  amount  of  land,  there- 
fore, now  uncultivated  on  farms  that  could  be  put  un- 
der the  plow  and  which  would  in  all  probability  sup- 
ply all  the  requirements  of  land  settlement  for  de- 
mobilized soldiers  for  many  years  to  come  without 
resorting  to  costly  drainage  and  irrigation  projects 
which  will  take  long  periods  of  time  to  complete. 
Such  projects  could  not  possibly  be  of  any  immediate 
service  in  increasing  agricultural  production,  which 
is  the  pressing  need  of  the  hour.  They  could,  how- 
ever, furnish  employment  to  demobilized  soldiers  in 
their  construction,  and  this  is  one  of  the  aims  of  the 
Eeclamation  Service  of  the  Department  of  the  In- 


186     The  Place  of  Agriculture  in  Reconstruction 

terior  in  its  plan  of  land  settlement  for  soldiers.  So 
far  as  land  areas  and  farming  opportunities  are  con- 
cerned, there  is  no  reason  why  all  the  unemployed  la- 
bor forces  released  by  the  cessation  of  the  war  can 
not  be  readily  absorbed  in  agricultural  production  if 
they  should  offer  themselves  for  this  line  of  work. 
As  we  shall  see  later,  very  little  provision  has  been 
made  for  this  emergency  and  there  is  very  little  de- 
sire on  the  part  of  ex-service  men  to  seek  entrance 
into  the  various  lines  of  farm  work  in  this  country. 

In  a  pamphlet  entitled  "  Farms  for  Eeturned  Sol- 
diers, "  the  Secretary  of  the  Interior  states  that  the 
United  States  has  approximately  230,657,755  acres  of 
free  land,  but  that  "it  is  safe  to  say  that  not  one- 
half  of  this  land  will  ever  prove  to  be  cultivable  in 
any  sense. "  In  addition,  he  estimates  that  there  are 
practically  about  15,000,000  acres  of  desert  land 
which  may  be  reclaimed  by  irrigation ;  some  80,000,- 
000  acres  of  swamp  land  open  to  reclamation  by 
drainage;  and  about  200,000,000  acres  of  cut-over 
land  which  is  suitable  for  agricultural  development. 
But  Secretary  Lane  adds  this  important  statement 
regarding  the  ownership  of  these  lands  and  their  re- 
lation to  any  future  settlement  scheme  for  soldiers : 

"It  has  been  officially  estimated  that  more  than 
15,000,000  acres  of  irrigable  land  now  remain  in  the 
government's  hands.  This  is  the  great  remaining 
storehouse  of  government  land  for  reclamation.  Un- 
der what  policy  and  program  millions  of  these  acres 


Land  Settlement — United  States         187 

could  be  reclaimed  for  future  farms  and  homes  re- 
mains for  legislation  to  determine.  The  amount  of 
swamp  and  cut-over  lands  in  the  United  States  that 
can  be  made  available  for  farming  is  extensive.  Just 
how  much  there  is  has  never  been  determined  with 
any  degree  of  accuracy.  Practically  all  of  it  has 
passed  into  private  ownership.  For  that  reason  in 
considering  its  use,  it  would  be  necessary  to  work 
out  a  policy  between  the  private  owners  and  the 
government  unless  the  land  was  purchased." 

From  this  statement  it  appears  that  only  a  com- 
paratively small  part  of  the  land  area  of  the  United 
States  is  publicly  owned ;  that  this  land  must  first  be 
reclaimed  by  irrigation  projects  before  it  can  be  used 
for  farming;  that  the  swamp  and  cut-over  lands  have 
passed  into  the  hands  of  private  owners;  and  that 
the  actual  extent  of  this  land  is  not  accurately  known. 
At  the  close  of  1918  the  plan  of  land  settlement  for 
soldiers  had  reached  the  stage  that  $200,000  had  been 
appropriated  by  Congress  to  make  a  preliminary 
study  of  the  unused  lands  of  the  country  and  to  as- 
certain with  more  accuracy  the  actual  extent  of  such 
reclaimable  land  areas ;  and  also  that  $1,000,000  more 
had  been  recommended  by  the  President  to  be  used 
in  the  same  work.  In  other  words,  all  money  al- 
ready appropriated  and  all  money  which  has  been 
asked  to  be  appropriated  will  be  expended  in  ascer- 
taining how  many  millions  of  acres  of  land  can  not 
be  used  for  agricultural  production  until  they  have 


188     The  Place  of  Agriculture  in  Reconstruction 

been  reclaimed  by  irrigation,  by  clearing,  and  by 
drainage. 

A  New  Land  Policy  for  Soldiers 

By  far  the  largest  part  of  the  reclaimable  land 
areas  in  the  United  States  is  confined  to  the  cut-over 
lands  in  the  Pacific  Northwest,  within  the  states  of 
Oregon  and  "Washington ;  in  the  lake  states  of  Min- 
nesota, Wisconsin  and  Michigan;  and  in  the  South 
Atlantic  and  Gulf-Coast  states  of  Virginia,  North 
Carolina,  South  Carolina,  Georgia,  Florida,  Ala- 
bama, Mississippi,  Louisiana  and  Texas.  The  tim- 
ber has  been  cut  off  these  lands  and  they  have  been 
left  to  grow  up  into  brush.  The  process  of  reclama- 
tion will  consist  largely  of  clearing  the  brush  growth 
and  removing  the  stumps.  An  estimate  by  the  De- 
partment of  the  Interior  of  the  amount  of  this  land 
which  is  suitable  for  agricultural  production  places 
it  at  about  200,000,000  acres.  But  substantially  all 
this  cut-over  or  logged-off  land  is  under  private 
ownership  and  has  remained  undeveloped  because  of 
inadequate  method  of  approach.  Of  this  extensive 
land  area  the  Department  of  the  Interior  has  said 
that  "unless  a  new  policy  of  development  is  worked 
out  in  cooperation  between  the  federal  government, 
the  states,  and  the  individual  owners,  the  greater 
part  of  it  will  remain  unsettled  and  uncultivated. ' ' 

The  plan  outlined  for  developing  all  such  unused 
land  is  to  employ  soldiers  thereon  in  reclamation 


Land  Settlement — United  States         189 

work.  For  several  years  large  areas  of  reclaimed 
land  have  been  subdivided  into  individual  farms  and 
then  sold  to  farmers  on  a  long-time  payment  basis 
under  the  provisions  of  the  reclamation  act.  One 
of  the  new  features  of  this  plan  is  that  the  occu- 
piers are  aided  in  the  improvement  and  cultivation 
of  their  farms.  It  is  proposed  to  adopt  this  policy 
but  on  a  larger  scale.  By  the  expenditure  of  the  ap- 
propriation of  $200,000  and  other  anticipated  ap- 
propriations, the  Department  of  the  Interior  ex- 
pects to  ascertain  "  where  it  is  practicable  to  begin 
new  irrigation  projects,  what  the  character  of  the 
land  is,  what  the  nature  of  the  improvements  needed 
will  be,  and  what  the  cost  will  be.  We  should  know 
also,  not  in  a  general  way  but  with  particularity, 
what  definite  areas  of  swamp  land  may  be  reclaimed, 
how  they  can  be  drained,  what  the  cost  of  the  drain- 
age will  be,  what  crops  they  will  raise.  We  should 
have  in  mind  specific  areas  of  grazing  lands,  with  a 
knowledge  of  the  cattle  which  are  best  adapted  to 
them  and  the  practicability  of  supporting  a  family 
upon  them.  So,  too,  with  our  cut-over  lands.  We 
should  know  what  it  would  cost  to  pull  or  blow  out 
stumps  and  to  put  the  lands  into  condition  for  a 
farm  home." 

It  will  be  noted,  however,  that  while  a  program  is 
outlined  for  determining  the  character  and  amount 
of  the  land  areas  that  can  be  used  for  agricultural 
purposes,  as  well  as  the  cost  of  the  reclamation 


190     The  Place  of  Agriculture  in  Reconstruction 

projects,  not  a  word  is  said  about  the  length  of  time 
it  will  take  to  prepare  these  lands  to  yield  crops. 
And  it  is  the  latter  feature  of  the  reconstruction 
problem  which  calls  for  immediate  solution.  In  the 
meantime  what  are  our  returned  soldiers  and  sailors 
to  do  in  the  way  of  employment?  The  new  land 
policy  provides  that  they  shall  be  engaged  in  reclaim- 
ing the  land,  constructing  the  irrigation  ditches, 
building  the  houses  and  barns,  and  fitting  the  land 
for  farming  as  civilian  government  employees.  The 
Secretary  of  the  Interior  thus  outlines  the  new  policy 
of  creating  farms  out  of  the  unreclaimed  lands  of  the 
country : 

"This  plan  does  not  contemplate  anything  like 
charity  to  the  soldier.  He  is  not  to  be  given  a  bounty. 
He  is  not  to  be  made  to  feel  that  he  is  a  dependent. 
On  the  contrary,  he  is  to  continue  in  a  sense  in  the 
service  of  the  government.  Instead  of  destroying 
our  enemies  he  is  to  develop  our  resources. 

'  '  The  work  that  is  to  be  done,  other  than  the  plan- 
ning, should  be  done  by  the  soldier  himself.  The 
dam  or  the  irrigation  project  should  be  built  by  him ;, 
the  canals,  the  ditches,  the  breaking  of  the  land  and 
the  building  of  the  houses  should,  under  proper  di- 
rection, be  his  occupation.  He  should  be  allowed  to 
make  his  own  home,  cared  for  while  he  is  doing  it, 
and  be  given  an  interest  in  the  land  for  which  he  can 
pay  through  a  long  period  of  years,  perhaps  30  or 
40  years.  This  same  policy  can  be  carried  out  as 


Land  Settlement — United  States        191 

to  the  other  classes  of  land,  so  that  the  soldier  on  his 
return  would  have  an  opportunity  to  make  a  home 
for  himself,  to  build  a  home  with  money  which  we 
would  advance  and  which  he  would  repay,  and  for 
the  repayment  we  would  have  an  abundant  security. 
The  farms  should  not  be  turned  over  as  the  prairies 
were — unbroken,  unfenced,  without  accommodations 
for  men  or  animals.  There  should  be  prepared  homes, 
all  of  which  can  be  constructed  by  the  men  them- 
selves, and  paid  for  by  them  under  a  system  of  sim- 
ple devising  by  which  modern  methods  of  finance 
will  be  applied  to  their  needs."  * 

Very  little,  however,  of  this  new  policy  and  pro- 
gram has  been  realized.  When  the  outline  of  the 
plan  given  above  was  written  it  was  expected  that, 
at  the  conclusion  of  the  war,  the  United  States  would 
be  able  to  say  to  its  returned  soldiers : 

"If  you  wish  to  go  upon  a  farm,  here  are  a  va- 
riety of  farms  of  which  you  may  take  your  pick; 
which  the  government  has  prepared  against  the 
time  of  your  returning. ' ' 

But  the  end  of  the  war  came,  a  million  men  or 
more  were  demobilized  from  our  camps,  and  two 
million  more  men  are  being  gradually  returned  to 
our  shores,  only  to  find  that  there  are  no  farms  ready, 
that  it  is  not  even  known  how  much  unreclaimed  land 
there  actually  is  in  the  country,  and  that  no  reclama- 

aDept.  of  the  Interior  pamphlet.  "Farms  for  Returned  Soldiers" 
(1918),  pp.  9,  10. 


192     The  Place  of  Agriculture  in  Reconstruction 

tion  projects  have  been  prepared  and  approved  to 
furnish  them  employment.  The  proposed  new  land 
policy  for  soldiers,  therefore,  is  still  a  reconstruc- 
tion enigma. 

The  cost  of  making  these  preliminary  surveys  has 
been  placed  by  the  Department  of  the  Interior  be- 
tween $1,000,000  and  $2,000,000;  those  familiar  with 
reclamation  work  estimate  the  cost  of  creating 
farms  out  of  the  arid,  semi-arid,  swamp  and  cut-over 
lands  as  something  like  $2,000,000,000.  And  some 
5,  10,  or  20  years  must  necessarily  elapse  before 
these  ideal  land  settlement  farms  could  see  the  light 
of  day,  with  their  model  community  centers  com- 
prised of  townsites  surrounded  by  40  or  80  acre 
farm  homes  well  provided  with  live  stock  and  farm 
implements,  and  possessing  all  the  advantages  and 
none  of  the  loneliness  of  ordinary  rural  life  and 
work.  In  the  meantime  half  a  billion  acres  of  un- 
used farm  lands,  which  could  be  put  into  cultiva- 
tion without  delay,  lie  idle  waiting  for  the  coming 
of  the  soldier  or  the  civilian  farm  laborer.  Many 
of  the  nations  of  the  earth  are  calling  for  food  and 
for  several  years  to  come  they  will  call  for  those 
raw  materials  of  industry  which  cultivation  of  the 
soil  and  live-stock  raising  can  alone  produce.  From 
these  two  points  of  view  there  is  farm  land  enough 
not  in  use  in  the  United  States,  which  would  pro- 
duce all  the  food  and  all  the  raw  materials  required 
by  our  own  and  by  other  nations  if  labor  and  capital 


Land  Settlement — United  States         193 

were  available.  These  are  the  two  factors  of  wealth 
production  which  are  vitally  important  to  the  suc- 
cess of  land  settlement  for  soldiers  in  the  United 
States. 

Supply  of  Unskilled  and  Farm  Labor 

There  are  two  requirements  necessary  to  make  dis- 
charged service  men  successful  farmers,  namely,  an 
inclination  to  do  hard  work  and  a  knowledge  of  farm 
practises.  Without  these  qualifications  those  who 
have  had  outdoor  life  as  soldiers  are  no  more  likely 
to  succeed  than  would  civilians  without  previous 
farming  experience.  As  regards  agriculture  all  land 
is  worthless  until  labor  and  capital  are  applied  to  it 
in  the  production  of  wealth.  The  first  step,  there- 
fore, in  increasing  agricultural  production  is  to  put 
trained  men  on  our  farms  wherever  possible.  If  our 
soldiers  and  sailors  have  not  had  this  training  in 
actual  experience  before  entering  the  military  or 
naval  forces  of  the  country,  they  should  be  given 
such  training  without  delay.  Any  other  policy  would 
be  fatal  to  their  success  as  landowning  farmers. 

Every  country  which  has  seriously  considered  the 
place  of  agriculture  in  reconstruction  has  recognized 
the  need  of  these  qualifications  in  all  applicants  for 
land  and  a  loan.  Educational  programs  have  been 
adopted  and  put  into  practise  in  Great  Britain, 
France,  Canada,  and  other  countries.  In  the  United 
States,  however,  little  or  no  place  was  found  for  gar- 


194     The  Place  of  Agriculture  in  Reconstruction 

dening  and  farming  in  the  program  of  the  Federal 
Board  for  Vocational  Education.  Under  the  influ- 
ence of  European  life  and  experience,  however,  vege- 
table gardens  for  convalescing  soldiers  were  estab- 
lished at  a  few  American  army  hospitals  in  France. 
These  proved  so  successful  in  engaging  the  mental 
and  physical  energies  of  sick  and  wounded  men  that 
the  American  Bed  Cross  sent  a  representative  back 
to  the  United  States  to  secure  the  services  of  ten 
expert  market  gardeners  to  direct  such  light  outdoor 
activities  at  all  American  army  hospitals  during 
their  continuance  in  France. 

According  to  reports  these  gardens  offered  inter- 
esting and  useful  occupations  to  convalescing  sol- 
diers and  were  of  great  practical  service  not  only  in 
providing  vegetables  for  the  hospitals,  but  in  giving 
the  men  an  insight  into  the  best  garden  practises 
and  a  liking  for  an  outdoor  mode  of  life.  In  many 
cases  of  shell  shock  the  doctors  agreed  that  garden 
or  farm  work  is  one  of  the  best  restoratives.  Many 
of  the  patients  enjoyed  the  outdoor  activities  so 
much  and  became  so  attached  to  the  soil  that  they 
have  announced  their  intention  of  obtaining  land 
and  taking  up  gardening  or  farming  on  their  return 
to  the  United  States. 

In  connection  with  one  of  the  hospital  gardens  the 
American  Bed  Cross  has  established  a  small  model 
experimental  dairy  with  some  thorough-bred  cows 
provided  by  the  French  government.  The  object  is 


Land  Settlement — United  States         195 

to  give  patients  instruction  in  the  care  of  cows,  to 
demonstrate  their  value  as  food  producers  on  small 
holdings,  and  to  prove  the  importance  of  keeping  live 
stock  for  the  production  and  use  of  organic  manures 
on  the  land.  A  small  increase  in  our  farm  labor  sup- 
ply may  be  anticipated  when  these  soldiers  have  been 
demobilized  after  their  return  to  this  country.  But 
from  this  source  no  great  increase  in  our  farming 
forces  can  be  expected.  Vocational  training  of 
American  soldiers  in  gardening  and  farming  either 
in  France  or  in  the  United  States  is  on  too  small  a 
scale  to  add  any  considerable  number  of  farm  labor- 
ers, tenant  farmers,  and  farm  owners  to  the  list  of 
those  already  engaged  in  agricultural  production. 

The  national  program  of  land  settlement  as  repre- 
sented by  the  Department  of  the  Interior  is  one  in- 
volving a  vast  amount  of  day-labor  work  for  a  long 
period  of  time  rather  than  of  actual  provision  for 
farm  labor.  The  plan  is  primarily  one  of  land 
reclamation,  not  of  agriculture.  The  latter  can  only 
be  encouraged  and  developed  after  the  reclaimed 
land  has  been  more  or  less  fitted  for  farming  pur- 
poses by  clearing,  leveling,  ditching,  stumping,  and 
fertilizing.  These  tasks  involve  the  hardest  physical 
labor  and  the  lowest  wages.  A  great  deal  of  it  calls 
for  unskilled  labor  under  direction  of  reclamation 
experts. 

The  problem,  then,  is  not  as  to  the  offer  of  work 
to  our  returned  soldiers,  but  whether  they  are  or  will 


196     The  Place  of  Agriculture  in  Reconstruction 

be  inclined  to  do  day-labor  work  of  the  kind  and  in 
the  places  where  it  may  be  offered  to  them.  The  as- 
sistant director-general  of  the  Employment  Service 
connected  with  the  United  States  Department  of 
Labor  evidently  speaks  with  authority  when  he  says 
that  soldiers  discharged  from  the  home  camps  "are 
unwilling  to  undertake  the  day-labor  jobs  which 
alone  they  can  find. "  Is  it  any  more  likely  that  men 
of  the  over-seas  army  will  be  more  willing  to  do  this 
kind  of  work  than  the  home  guard?  The  ranks  of 
unskilled  and  of  farm  labor  have  not  been  greatly 
recruited  from  the  million  and  more  men  demobilized 
from  camps  in  the  United  States,  nor  is  there  any 
information  available  which  would  favor  the  view 
that  the  men  who  have  seen  active  service  will  be 
more  inclined  to  swell  these  ranks  than  those  who 
were  in  training  unless,  perhaps,  the  wages  are  made 
high  enough  to  offset  the  unattractiveness  and 
strenuousness  of  the  work. 

But  that  raises  another  economic  problem  of  no 
small  magnitude.  Suppose  the  returned  soldiers  who 
do  this  kind  of  work  are  paid  $4  a  day,  as  it  is  pro- 
posed to  do,  what  effect  will  this  have  upon  the  price 
of  the  land  ultimately  expected  to  be  fitted  for  farm- 
ing? Will  it  not  raise  the  cost  of  such  land  to  a  price 
beyond  the  reach  of  the  average  soldier  and  render 
it  prohibitive  of  being  made  profitable  for  farming 
for  a  long  time  to  come?  Experience  has  shown  that 
to  make  farms  ready  for  cultivation  on  some  recla- 


Land  Settlement — United  States         197 

mation  projects  where  unskilled  laborers  were  paid 
the  normal  rates  of  wages  only,  the  estimated  value 
of  the  land  runs  from  $100  to  $150  an  acre.  If  the 
day-labor  wages  on  such  projects  had  been  doubled, 
the  cost  of  the  land  would  be  prohibitive.  And  if  it 
happened  to  be  an  irrigation  project,  to  these  land 
values  must  be  added  the  ultimate  cost  of  a  water 
right,  which  has  been  placed  at  between  $40  and  $50 
an  acre.  A  soldier  with  no  experience  and  little 
capital  would  find  the  problem  of  making  a  living  for 
himself  and  family  from  such  a  high-priced  farm  an 
exceedingly  difficult  one  to  solve  after  paying  inter- 
est and  amortization  payments  on  his  long-time  mort- 
gage and  short-time  personal  credit  loans. 

The  only  hope  of  salvation  for  such  settlers  under 
these  circumstances  would  be  to  grant  them  loans 
on  very  long  time  and  at  an  exceedingly  low  rate 
of  interest.  On  this  basis  the  annual  or  semi-annual 
instalments  on  loans  would  be  very  small  and  it  is 
possible  that  the  farmer  would  be  able  to  pay  them 
out  of  his  net  earnings.  But  the  first  years  of  set- 
tlement are  always  the  hardest  as  to  labor  and  the 
worst  as  to  income,  so  that  under  the  best  of  con- 
ditions the  prospects  of  the  average  soldier  on  re- 
claimed farm  holdings  would  be  that  he  could  look 
forward  to  plenty  of  hard  work,  much  anxiety,  and 
small  returns. 

One  other  difficulty  likely  to  arise  in  the  case  of 
farms  created  out  of  free  lands  is  that  the  soil  will 


198     The  Place  of  Agriculture  in  Reconstruction 

not  be  of  good  quality  for  crop  production.  The 
Secretary  of  the  Interior  has  stated  that  not  one- 
half  of  the  free  government  land  open  to  settlement 
will  ever  prove  to  be  cultivable.  The  other  half  is 
the  poorest  land  in  the  country.  Long  ago  the  best 
agricultural  lands  had  been  picked  and  settled,  so 
that  there  remains  of  free  land  for  soldiers  only 
that  which  will  yield  a  crop  with  difficulty.  This  is 
the  situation  as  to  free  land  and  it  is  not  promising 
from  any  point  of  view.  If  such  land  lies  in  humid 
regions,  it  would  require  to  be  reconstructed  by 
means  of  organic  manures ;  if  it  lies  in  arid  or  semi- 
arid  regions,  it  would  require  water  as  well  as  fer- 
tilizers; if  it  is  swamp  land,  it  would  have  to  be 
drained  and  possibly  limed ;  if  it  is  cut-over  land,  it 
would  have  to  be  cleared  and  fertilized.  The  prob- 
lem of  growing  a  crop,  feeding  his  live  stock,  and 
making  a  living  would  be  intensified  for  the  soldier 
settler  no  matter  how  easy  the  terms  or  how  long 
the  period  of  his  loan.  These  are  the  difficulties  which 
must  be  faced  in  any  plan  of  settlement  on  free  gov- 
ernment lands,  whether  or  not  they  are  subject  to 
reclamation  before  farming  operations  can  be  actu- 
ally begun. 

In  summing  up  the  entire  reclamation  outlook  with 
a  view  of  having  some  tangible  scheme  of  work  to 
offer  to  returning  soldiers,  the  Secretary  of  the 
Interior  reported  to  Congress  as  follows : 

"We  must  know,  first,  what  lands  are  available 


Land  Settlement — United  States         199 

for  such  use.  Then  we  must  have  surveys  and  esti- 
mates made  which  will  enable  us  to  say  which  bodies 
of  land  of  the  various  classes  are  most  available,  and 
that  from  many  standpoints — soil,  climate,  markets, 
relative  cost  of  reclamation.  And,  thirdly,  when 
these  selections  are  made  in  the  different  sections 
of  the  country,  plans  in  detail  must  be  made  which 
can  be  submitted  to  the  Congress  for  the  develop- 
ment of  these  projects.  To  do  this  as  to  the  drain- 
able  lands  of  the  South,  for  instance,  or  the  irrigable 
lands  of  the  West,  will  necessitate  speed  if  we  are 
to  meet  the  soldiers  on  their  return  with  a  positive 
proposition  that  they  may  take  new  employment 
under  the  government  in  constructive  national 
work."1 

The  most  vital  point  affecting  the  supply  of  un- 
skilled labor  on  proposed  reclamation  projects  is 
the  fact  that  demobilized  soldiers  are  not  inclined  to 
engage  in  this  kind  of  work.  The  same  is  true  in  the 
matter  of  procuring  farms  on  these  reclaimed  lands. 
Of  course  there  is  neither  work  nor  farms  to  offer 
them  at  present  because  Congress  has  made  no  pro- 
vision for  these  projects.  But  the  subject  has  been 
given  general  publicity  in  our  camps  and  throughout 
the  country.  But  of  a  million  men  demobilized  in 
the  United  States  only  a  very  few  have  made  in- 
quiries about  land  and  a  loan.  Letters  of  inquiry 
addressed  to  the  United  States  Department  of  Agri- 

1  Senate  Export  No.  580,  65th  Cong.,  2d  Sess.,  p.  2. 


200    The  Place  of  Agriculture  in  Reconstruction 

culture  or  the  Department  of  the  Interior  are  gen- 
erally referred  to  the  Federal  Farm  Loan  Bureau 
for  reply,  especially  if  the  inquirer  asks  about  a 
loan.  This  is  probably  because  it  is  now  quite  gen- 
erally known  throughout  the  country  that  the  federal 
farm  loan  system  makes  mortgage  loans  to  farmers 
on  easy  terms  as  to  rate  of  interest,  method  of  re- 
payment, and  period  of  loan.  But  the  system  was 
instituted  for  farmers  and  not  for  returned  soldiers, 
very  few  of  whom  are  landowners.  But  no  public 
land  is  open  to  settlement  except  under  the  Home- 
stead Law,  and  no  loan  can  be  made  under  the  Fed- 
eral Farm  Loan  Act  except  on  first  mortgage  on 
farm  land  at  5%  per  cent  interest,  so  that  a  newly 
settled  homesteader  cannot  be  granted  a  loan  under 
the  federal  farm  loan  system.  The  simple  fact  is, 
therefore,  that  in  the  spring  of  1919,  the  few  soldiers 
who  are  inclined  to  make  entry  as  settlers  can  be 
given  no  encouragement  to  do  so,  because  no  na- 
tional program  has  been  prepared  for  supplying 
either  land  or  capital. 

Cooperation  wth  State  Governments 

In  addition  to  gathering  information  as  to  the  ex- 
tent of  the  largest  bodies  of  land  which  can  be  wisely 
placed  under  irrigation,  those  which  have  been  cut 
over,  and  those  which  can  be  reclaimed  by  draining, 
the  Department  of  the  Interior  sought  in  its  survey 
to  ascertain  the  size  and  availability  of  the  bodies  of 


Land  Settlement — United  States         201 

unused  tillable  land  in  the  country.  The  object  in 
this  case  was  to  have  each  state  cooperate  with  the 
national  government  "in  providing  farm  homes  for 
its  own  returned  soldiers,  and  that  it  was  well  to 
have  some  information  in  hand  for  the  Congress  on 
this  matter." 

On  September  14,  1918,  a  letter  was  addressed  to 
the  governor  of  each  state  suggesting  the  practi- 
cability of  this  cooperation  and  asking  a  series  of 
questions  as  to  the  amount  of  available  unused  lands 
within  each  state.  So  great  an  interest  was  mani- 
fested in  this  matter  that  a  bill  was  drawn  up  to 
provide  employment  and  rural  homes  for  soldiers, 
sailors  and  marines,  "under  which  the  states  shall 
furnish  the  lands  and  the  United  States  the  funds, 
with  an  alternative  proposition  so  that  the  states 
may  participate  further  in  furnishing  funds  and  also 
in  supervising  the  improvement  and  settlement  of 
the  lands."  The  bill  was  submitted  to  all  state 
governors  who  were  requested,  if  it  met  their  ap- 
proval, to  present  it  to  their  respective  legislatures. 
If  passed  it  is  to  be  known  as  "The  Soldier  Settle- 
ment Act"  as  in  Canada. 

The  bill  provides  for  the  appointment  of  a  board 
of  three  commissioners  in  each  state  with  authority 
to  expend  funds  for  acquiring  agricultural  lands  and 
to  utilize  state  public  lands  suitable  for  settlement 
purposes. 

The  basis  of  cooperation  under  the  first  plan  is 


202     The  Place  of  Agriculture  in  Reconstruction 

that  the  state  shall  provide  the  land  needed  for  set- 
tlement and  the  United  States  shall  provide  the 
money  necessary  to  meet  the  expenses  of  reclama- 
tion and  subdivision  of  land  and  the  purchase  of 
necessary  improvements  and  equipment  to  perform 
the  necessary  work,  and  to  have  charge  of  all  settle- 
ment work. 

The  basis  for  cooperation  under  the  second  plan  is 
for  the  board  of  commissioners  to  make  actual  ex- 
penditures in  an  amount  not  less  than  25  per  cent 
of  the  total  investment  for  reclamation,  for  actual 
payment  for  the  land,  for  farm  improvements,  and 
for  the  purchase  of  farm  implements,  live  stock  and 
other  necessary  equipment.  Under  the  supervision 
of  the  Secretary  of  the  Interior  the  board  has  au- 
thority to  control  the  preparation  of  the  land  for 
homes  and  for  its  settlement.  In  the  matter  of  sub- 
division of  the  land  and  its  improvement  it  is  pro- 
vided that  the  unimproved  land  for  individual  farms 
shall  not  exceed  a  value  of  $15,000  and  for  farm- 
laborer  allotments  a  value  not  exceeding  $1,500. 
Such  improvements  as  seeding,  planting,  fencing  and 
draining  the  land,  as  well  as  the  erection  of  dwelling 
house,  barn  or  other  buildings,  may  be  made  by  the 
settler  under  contract  with  the  board,  or  these 
necessary  improvements  may  be  carried  out  by  the 
board  before  the  farms  and  allotments  are  opened 
for  settlement.  Funds  for  the  purchase  of  land, 
the  making  of  permanent  improvements,  and  the 


Land  Settlement— United  States         203 

purchase  of  farm  equipment  may  be  borrowed  of  the 
United  States. 

Loans  made  to  settlers  for  the  purchase  of  land 
and  the  making  of  permanent  improvements  are 
designated  as  ' '  long-time ' '  loans ;  those  made  for  the 
purchase  of  live  stock,  necessary  equipment  and  sup- 
plies, and  for  fitting  the  land  for  crop  production  are 
called  "short-time"  loans.  The  latter  cannot  ex- 
ceed $3,000  on  a  farm  and  $1,000  on  a  farm-laborer 
allotment.  Loans  will  be  made  only  to  approved  set- 
tlers who  are  citizens  of  the  United  States  and  on 
the  condition  that  they  possess  not  less  than  10  per 
cent  of  the  improved  and  equipped  value  of  the  farm 
or  allotment  and  are  fit  to  cultivate  and  develop  the 
same  successfully. 

Each  approved  applicant  enters  into  a  contract  of 
purchase,  which  creates  a  first  mortgage  or  other 
effective  lien  for  the  payment  of  the  price  of  the 
land,  the  reclamation  costs,  the  farm  improvements, 
and  other  charges.  He  also  agrees  to  actually  occupy 
the  land  within  six  months  and  reside  thereon  for  at 
least  eight  months  of  each  calendar  year  during  a 
period  of  five  years,  unless  prevented  by  sickness 
or  other  cause  satisfactory  to  the  board. 

The  payment  of  a  loan  by  a  soldier  settler  is  pro- 
vided for  as  follows : 

"The  contract  shall  provide  for  immediate  pay- 
ment of  2  per  cent  of  the  sale  price  of  the  land,  in- 
cluding reclamation  costs,  and  in  addition  not  less 


204     The  Place  of  Agriculture  in  Reconstruction 

than  10  per  cent  of  the  cost  of  the  farm  improve- 
ments. The  balance  of  the  amount  for  the  land  and 
the  reclamation  costs  shall  be  due  as  follows:  2 
per  cent  each  year  for  the  first  four  years,  and  there- 
after shall  be  due  in  annual  payments  to  be  fixed  by 
the  board  for  a  further  period  not  exceeding  -iO 
years  so  as  to  repay  the  capital  sum  with  interest 
on  deferred  payments  from  the  date  of  the  con- 
tract at  the  rate  of  4  per  cent  per  annum.  The  title 
to  the  land  shall  not  pass  until  full  payment  for 
the  land  and  the  reclamation  costs. 

1 '  The  amount  due  on  farm  improvements  shall  be 
repaid  in  a  period  to  be  fixed  by  the  board  not  ex- 
ceeding 20  years  so  as  to  return  the  capital  sum  with 
interest  on  deferred  payments  at  the  rate  of  4  per 
cent  per  annum. 

"The  repayment  of  short-time  loans  shall  extend 
over  a  period  to  be  fixed  by  the  board  not  exceeding 
5  years,  payable  in  such  amounts  and  at  such  times 
as  may  be  determined  by  the  board. 

"The  purchaser  shall  have  the  right  on  any  in- 
stalment date  to  pay  any  or  all  instalments  there- 
after due. " 

The  contract  of  purchase  also  provides  that  the 
settler  shall  cultivate  the  land  in  a  manner  approved 
by  the  board,  shall  keep  all  improvements,  buildings 
and  equipment  in  order  and  repair,  and  shall  pay 
such  assessments  as  a  board  may  levy  to  provide  the 
equivalent  of  insurance.  If  the  settler  fails  to  com- 


Land  Settlement — United  States         205 

ply  with  any  of  the  terms  of  the  contract,  all  pay- 
ments previously  made  thereon  are  to  be  deemed  a 
rental  paid  for  occupancy.  Upon  the  forfeiture, 
cancellation  or  relinquishment  of  a  contract,  a  board 
has  the  right  to  sell  any  farm  or  allotment  with  im- 
provements, buildings  and  equipment  to  any  other 
qualified  purchaser. 

Any  state  board  of  commissioners  appointed  under 
the  provisions  of  this  bill  has  authority  to  provide 
all  necessary  means  for  furnishing  agricultural 
training  for  the  soldier  so  as  to  render  him  better 
qualified  for  the  cultivation  of  his  land. 

Analysis  of  the  Cooperative  Plan 

The  plan  of  land  settlement  by  soldiers  outlined 
above  is  dependent  upon  the  passage  of  the  proposed 
bill  by  the  various  state  legislatures.  Some  of  them 
may  not  meet  for  a  year  and  others  even  for  two 
years.  The  bill  may  not  be  passed  even  then,  or,  if 
passed,  may  be  modified  considerably.  But,  assum- 
ing that  this  bill  will  become  a  law  as  it  has  been 
drawn  by  the  United  States  Department  of  the  In- 
terior, it  is  necessary  to  know  clearly  just  what  it 
offers  to  a  returned  soldier  who  may  desire  to  take 
up  one  of  the  proposed  farms  or  farm-laborer  allot- 
ments on  a  reclamation  project  and  also  what  are  the 
soldier's  financial  obligations  in  the  matter.  For 
example,  if  a  settler  desires  to  purchase  unimproved 
land  or  an  improved  farm  or  allotment  valued  at 


206    The  Place  of  Agriculture  in  Reconstruction 

$1,500,  $5,000  or  $10,000,  what  are  the  terms  and 
conditions  of  repayment  of  loans  which  confront 
him?  Let  us  see. 

1.  The  land.  A  settler  cannot  purchase  land  un- 
less he  can  satisfy  the  board  that  he  has  sufficient 
capital  to  provide  for  the  immediate  payment  of  2 
per  cent  of  the  sale  price  of  the  land,  including  the 
reclamation  costs,  and  2  per  cent  each  year  for  the 
first  four  years.  On  a  farm-laborer  allotment 
valued  at  $1,500  he  will  pay  down  $30  at  once  and  the 
same  amount  each  year  for  the  next  four  years,  a 
total  of  $150.  On  reclaimed  farm  land  valued  at 
$5,000,  his  immediate  cash  payment  would  be  $100 
and  four  successive  payments  $400  more,  a  total  of 
$500.  On  reclaimed  land  valued  at  $10,000,  his  im- 
mediate cash  payment  would  be  $200,  and  the  same 
amount  each  year  for  the  next  four  years,  a  total 
of  $1,000.  After  five  years  he  would  owe  on  a  $1,500 
farm-laborer  allotment  $1,350  on  the  land  and  $4.80 
interest  at  4  per  cent  on  the  four  deferred  payments, 
or  $1,354.80;  on  unimproved  reclaimed  land  worth 
$5,000  he  would  owe  $4,500  and  interest  as  above,  or 
$4,516 ;  and  on  similar  land  worth  $10,000  he  would 
owe  $9,000  and  interest  on  deferred  payments  or 
$9,032.  On  the  unpaid  balance  of  his  debt  the  pur- 
chaser pays  4  per  cent  interest  and  he  has  to  pay 
the  balance  due  in  annual  amortization  instalments 
during  a  further  period  not  exceeding  40  years. 


Land  Settlement — United  States         207 

The  reclamation  of  the  land  for  agricultural  use 
may  include  the  construction  of  works  for  drainage, 
irrigation,  building  levees,  general  sanitation  and 
sub-division  of  the  land,  the  clearing  of  timber,  the 
leveling  of  land  when  necessary,  and  for  other  work 
as  the  nature  of  the  individual  project  may  require, 
in  order  to  render  one  or  more  groups  of  farms  avail- 
able for  agriculture. 

When  a  returned  soldier  buys  land  which  requires 
the  maintenance  by  a  state  board  of  any  such  irriga- 
tion, drainage  or  other  works  or  improvements,  the 
board  has  authority  to  require  of  each  purchaser  of 
land,  "the  payment  of  proper  and  reasonable  charges 
for  the  operation,  maintenance  and  preservation  of 
such  works  and  shall  also  be  authorized  to  make 
reasonable  charges  pursuant  to  general  regulations 
for  services  rendered  to  the  purchasers  of  land  and 
others. ' '  What  airy  particular  maintenance  and  ser- 
vice charges  may  amount  to  cannot  be  stated,  but 
they  are  annual  charges  which  every  settler  must 
pay  as  they  become  due.  No  privilege  is  granted  of 
deferring  these  maintenance  and  service  charges 
to  the  time  when  the  soldier  has  become  well  estab- 
lished as  a  prosperous  farmer,  but  they  must  be 
paid  even  during  the  first  trying  years  of  his  ex- 
perience when  the  struggle  to  succeed  is  the  most 
strenuous. 

After  the  payments  for  the  land  and  reclamation 
costs,  the  maintenance  charge,  and  the  service  charge 


208     The  Place  of  Agriculture  in  Reconstruction 

have  continued  for  five  years,  the  annual  amortiza- 
tion instalments  must  begin  in  order  to  pay  o.T  Ahe 
entire  debt  on  the  reclaimed  land  with  interest  at  4 
per  cent.  The  time  allowed  for  repaying  the  debt 
on  the  land  is  optional  with  each  state  board,  but 
it  cannot  exceed  40  years.  The  longer  the  time  al- 
lowed the  smaller  will  be  the  annual  payments  on 
the  capital  debt  to  redeem  it  within  the  stated  time. 

In  view  of  the  other  charges  against  the  land  and 
the  expense  of  operation  during  the  earlier  years  of 
settlement,  each  soldier  settler  should  accept  the 
full  period  of  40  years  for  paying  his  debt  on  the 
reclaimed  land  in  order  to  lower  his  annual  neces- 
sary expenditures  as  much  as  possible.  This  is  espe- 
cially desirable  in  view  of  the  fact  that  he  is  granted 
the  privilege  of  paying  off  any  part  or  all  of  his  land 
indebtedness  at  any  instalment  date.  In  every  pros- 
perous year,  therefore,  a  settler  might  be  able  to 
pay  off  a  much  larger  sum  than  the  regular  instal- 
ment on  his  land  indebtedness,  thereby  decreasing 
both  the  period  of  his  loan  and  the  amount  of  inter- 
est. For  under  the  amortization  plan  of  repayment, 
a  debtor  has  to  pay  interest  on  the  unpaid  balance  of 
his  debt  only.  The  result  is  that  while  the  regular 
annual  instalment,  which  includes  interest  and  a 
part  of  the  principal,  does  not  change  during  the 
life  of  a  debt,  the  amount  annually  applied  in  the 
payment  of  interest  is  always  decreasing,  while  the 
sum  applied  in  extinguishing  the  debt  increases  from 


Land  Settlement — United  States         209 

year  to  year.  The  privilege  granted  to  soldiers  of 
paying  off  any  part  of  their  land  indebtedness  at 
any  instalment  period  will  work  to  their  advantage 
by  reducing  the  amount  of  interest  they  will  have  to 
pay  and  the  period  of  their  indebtedness.  Under  this 
privilege  a  soldier  may  be  able  to  pay  off  the  land 
debt  on  his  farm  within  20  years  instead  of  40  years, 
as  designated  in  the  proposed  law. 

At  the  end  of  the  fifth  year  the  first  regular  in- 
stalment on  his  debt  for  the  land  and  reclamation 
costs  becomes  due,  and  this  instalment,  which  in- 
cludes interest  at  4  per  cent  and  part  of  the  debt,  is 
payable  each  year  for  40  years,  at  which  time  the  debt 
on  the  land  will  have  been  paid.  On  the  basis  of 
the  figures  given  above,  the  regular  instalments 
will  be  as  follows : 

Debt  of  $1,354.80;  annual  instalment  $68.45 
"      "     4,516.00;       "  "  228.16 

"      "     9,032.00;       "  "  456.33 

If  the  value  of  the  land  and  reclamation  costs 
should  equal  the  maximum  of  $15,000  permitted  by 
the  bill,  a  soldier  settler  would  pay  off  $1,500  during 
the  first  four  years.  At  the  end  of  the  fifth  year,  he 
would  owe  on  the  land,  with  interest  on  deferred 
payment^  at  4  per  cent,  $13,548.  To  repay  this  debt 
with  interest  at  4  per  cent  a  year  in  40  years,  the 
annual  instalment  would  be  $684.50. 

It  can  readily  be  seen,  therefore,  that  a  soldier 
who  takes  up  a  farm  on  reclaimed  land  will  have  a 


210     The  Place  of  Agriculture  in  Reconstruction 

serious  financial  problem  to  meet  even  though  the 
debt  has  to  be  paid  on  the  amortization  plan  and 
on  comparatively  long  time  and  low  rate  of  interest. 
The  title  to  the  land  cannot  pass  to  the  settler  until 
full  payment  for  the  land  and  the  reclamation  costs 
has  been  made. 

2.  Farm  improvements.  But  there  are  other 
payments  which  a  soldier  who  settles  on  reclaimed 
land  has  to  make  besides  those  on  the  land  itself 
and  which  may  materially  affect  either  his  decision 
to  take  up  a  farm  under  a  reclamation  project  or  his 
ability  to  succeed  on  such  a  farm.  One  of  the  most 
important  of  these  payments  is  that  concerning  farm 
improvements.  Under  the  proposed  bill  farm  im- 
provements may  include  the  seeding,  planting  and 
fencing  of  the  land,  the  erection  of  dwelling  houses 
and  out-buildings,  "the  construction  of  farm  drains 
and  laterals,  and  the  making  of  such  other  improve- 
ments as  may  be  deemed  necessary  or  proper  to 
render  the  particular  farm  or  allotment  habitable 
and  productive. "  The  maximum  expenditure  for 
farm  improvements  upon  any  particular  farm  or 
allotment  is  to  be  agreed  upon  between  a  state  board 
and  the  United  States. 

Whatever  these  expenditures  may  be,  a  settler  is 
required  to  pay  immediately  "not  less  than  10  per 
cent  of  the  cost  of  the  farm  improvements."  If  the 
farm  improvements  cost  $3,000,  the  settler  must  be 


Land  Settlement — United  States         211 

prepared  to  pay  down  $300  when  he  takes  possession 
in  addition  to  the  2  per  cent  of  the  land  value  and 
reclamation  costs.  For  the  payment  of  the  balance 
of  the  cost  of  the  farm  improvements,  the  bill  pro- 
vides as  follows : 

' '  The  amount  due  on  farm  improvements  shall  be 
repaid  in  a  period  to  be  fixed  by  the  board  not  ex- 
ceeding 20  years  so  as  to  return  the  capital  sum  with 
interest  on  deferred  payments  at  the  rate  of  4  per 
cent  per  annum. " 

Since  nothing  is  said  in  this  sentence  to  indicate 
what  are  the  "deferred  payments"  or  how  many 
years  they  shall  continue,  it  is  more  than  likely  that 
this  is  an  error.  The  settler  has  to  pay  immediately 
for  farm  improvements  10  per  cent  of  their  cost, 
and  this  is  the  same  total  percentage  payments  re- 
quired for  the  land  and  the  reclamation  costs  which, 
however,  in  addition  to  the  immediate  payment  of 
2  per  cent  of  their  cost,  are  carried  over  a  period  of 
4  years  after  the  date  of  the  contract  of  purchase. 
In  all  probability,  therefore,  there  are  no  deferred 
payments  in  the  case  of  farm  improvements,  but  it 
is  required  that  the  settler  shall  pay  off  the  balance 
of  their  cost  in  20  years  from  the  date  of  the  con- 
tract. On  the  basis  of  an  immediate  payment  of  10 
per  cent  of  the  cost,  or  $300,  before  he  can  take 
possession,  the  debt  remaining  on  farm  improve- 
ments will  be  $2,700  payable  in  20  years  at  4  per 
cent  annual  interest.  Under  these  terms  and  con- 


212     The  Place  of  Agriculture  in  Reconstruction 

ditions  the  balance  of  the  cost  of  farm  improve- 
ments will  be  paid  off  by  the  payment  of  an  annual 
instalment  of  $198.67. 

Now  let  us  see  what  amount  of  capital  a  settler 
will  annually  need  in  order  to  meet  the  payments  on 
his  debt  for  land,  reclamation  costs,  and  farm  im- 
provements. 

On  the  basis  of  the  reclaimed  farm  land  being 
worth  $5,000,  $10,000  or  $15,000,  he  must  be  pre- 
pared to  pay  in  cash  2  per  cent  of  either  sum  plus 
10  per  cent  of  the  cost  of  the  farm  improvements, 
in  this  case  assumed  to  be  worth  $3,000.  Thus  on 
an  improved  reclaimed  farm  worth  $8,000,  the  set- 
tler must  pay  immediately  $400;  on  a  similar  farm 
worth  $13,000  his  payment  will  be  $500 ;  and  on  an 
improved  farm  valued  at  $18,000  his  immediate  cash 
payment  must  be  $600. 

For  the  next  four  years  the  settler  has  to  pay 
annually  2  per  cent  of  the  land  and  reclamation 
costs,  together  with  his  regular  amortization  pay- 
ment of  $198.67  on  farm  improvements.  During  the 
first  four  years  of  occupancy,  therefore,  he  must 
be  prepared  to  pay  on  an  improved  reclaimed  farm 
valued  at  $8,000,  being  $5,000  on  the  land  and  $3,000 
on  improvements,  the  sum  of  $100  on  land  and 
$198.67  on  improvements,  a  total  of  $298.67;  on  a 
farm  valued  similarly  at  $13,000,  the  annual  pay- 
ment will  be  $398.67;  and  on  an  improved  farm 


Land  Settlement— United  States         213 

valued   at   $18,000,   the    annual   payment   will   be 
$498.67. 

At  the  end  of  the  fifth  year  the  plan  of  pay- 
ment will  be  different.  Then  he  will  pay  the  regu- 
lar instalments  on  land  and  farm  improvements 
as  follows: 

Annual  instalment  on  land  debt  of  $4,516    is    $228.16 

"   improvements  debt  of  2,700    "       198.67 

Total  annual  payment  on  farm  valued  at         $8,000    is    $426.83 

Annual  instalment  on  land  debt  of  $9,032    is    $456.33 

1 '  improvements  debt  of  2,700    ' '       198.67 

Total  annual  payment  on  farm  valued  at       $13,000    is    $655.00 

Annual  instalment  on  land  debt  of  $13,548     is    $684.50 

"   improvements  debt  oi          2,700    "       198.67 

Total  annual  payment  on  farm  valued  at      $18,000    is    $883.17 

According  to  the  value  of  the  farm  selected,  these 
annual  payments  must  be  continued  for  16  years  in 
order  to  pay  the  debt  on  farm  improvements,  after 
which  time  the  annual  instalments  on  the  land  in- 
debtedness must  be  paid  for  20  years  longer  before 
a  soldier  settler  will  receive  title  to  his  farm.  Unless 
a  purchaser,  therefore,  has  a  large  amount  of  re- 
serve capital  at  the  beginning  and  during  a  large 
part  of  the  time  he  is  operating  his  farm,  he  must 
be  prepared  to  meet  these  payments  out  of  the  net 
earnings  of  his  farming  operations.  It  is  this  finan- 
cial problem  which  confronts  every  soldier  settler 
on  the  class  of  high-priced  farms  offered  under 
reclamation  projects. 


214     The  Place  of  Agriculture  in  Reconstruction 

An  alternative  plan  for  providing  the  farm  im- 
provements and  thereby  saving  the  payment  of  the 
annual  instalments  thereon  is  that  a  state  board 
is  given  authority  "to  contract  with  the  settler  to 
make  such  improvements  upon  each  farm  or  farm 
allotment. "  But  this  can  only  be  done  where  the 
settler  has  a  large  amount  of  capital  at  his  disposal 
with  which  to  pay  for  the  necessary  farm  improve- 
ments to  make  the  farm  habitable  and  productive  or 
he  is  able  to  borrow  the  money  for  this  purpose. 
But  unless  he  can  borrow  money  at  less  than  4  per 
cent,  he  would  simply  add  to  his  financial  burden  by 
constructing  the  farm  improvements  with  borrowed 
capital.  Looked  at  from  any  point  of  view,  the 
problem  of  meeting  the  financial  obligations  on  a 
farm  purchased  under  the  above  conditions  is  by  no 
means  an  easy  one  to  solve. 

3.  Short-time  loans.  The  last  point  for  consid- 
eration is  the  provision  relating  to  short-time  loans. 
A  state  soldier  settlement  board  is  authorized  to  se- 
cure from  the  United  States  the  necessary  funds  to 
make  loans  to  approved  settlers  for  the  purchase  of 
farm  implements,  stock  and  other  necessary  equip- 
ment, which  are  defined  as  "short-time  loans. "  They 
are  to  be  secured  by  effective  liens  or  chattel  mort- 
gages upon  the  property  purchased  with  the  money. 
The  total  amount  of  each  short-time  loan  thus  bor- 


Land  Settlement — United  States         215 

rowed  cannot  exceed  $3,000  for  a  farm  or  $1,000  for 
a  farm-laborer  allotment. 

But  how  are  short-time  loans  to  be  repaid?  It  is 
provided  that  they  may  extend  "over  a  period  to  be 
fixed  by  the  board  not  exceeding  5  years,  payable 
in  such  amounts  and  at  such  times  as  may  be  deter- 
mined by  the  board. " 

The  question  here  arises  whether  or  not  short- 
time  loans  are  to  be  granted  without  interest.  No 
rate  of  interest  being  stated,  the  only  course  left  to 
us  is  to  calculate  the  amount  the  borrower  will  have 
to  pay  to  cancel  his  debt  within  5  years.  In  view 
of  the  other  payments  which  must  be  met,  the  easiest 
method  of  repayment  is  to  divide  each  loan  into  five 
equal  instalments.  On  a  farm  loan  of  $3,000  the 
settler  must  be  prepared  to  pay  $600  a  year  in  addi- 
tion to  the  payment  requirements  for  the  land,  recla- 
mation costs,  and  farm  improvements;  and  on  a 
farm-laborer  allotment  loan  of  $1,000,  the  annual 
payment  will  be  $200. 

Summary  of  the  Situation 

This  analysis  places  before  us  not  only  the  entire 
financial  obligations  of  a  settler  who  might  under- 
take to  purchase  and  operate  a  farm  under  a 
reclamation  project,  but  also  a  summary  of  the  situa- 
tion as  it  applies  to  land  settlement  by  soldiers  in 
the  United  States.  It  is  difficult  to  see  how  a  re- 
turned soldier  with  little  or  no  capital  will  be  able 


216     The  Place  of  Agriculture  in  Reconstruction 

to  purchase  and  pay  for  a  farm  out  of  the  cash 
returns  derived  from  its  operation  after  such  farms 
constructed  out  of  reclaimed  land  have  been  opened 
for  settlement.  In  brief,  the  financial  burdens  of 
a  settler  will  be  as  follows : 

(1)  Immediate  cash  payments.    These  include  2 
per  cent  on  land  and  reclamation  costs  valued  at 
$5,000  to  $15,000  and  10  per  cent  on  farm  or  allot- 
ment improvements  valued  at  $1,000  to  $3,000,  thus 
requiring  each  settler  to  have  cash  to  pay  down 
ranging  from  $400  to  $600. 

(2)  First  to  fourth  year,  inclusive.    These  pay- 
ments include  2  per  cent  on  land,  annual  instalment 
on  the  debt  for  farm  improvements  estimated  at 
$2,700  and  20  per  cent  on  a  short-time  loan  for  farm 
equipment  varying  from  $1,000  to  $3,000,  thus  re- 
quiring each  settler  to  be  prepared  to  pay  out  of 
reserve  capital  or  the  profits  of  farming  an  annual 
payment  ranging  from  $898.67  to  $1,098.67. 

(3)  Fifth  year.    These  payments   include   the 
regular  instalments  on  the  debt  for  land,  reclama- 
tion costs,  and  farm  improvements,  and  also  20  per 
cent  on  the  short-time  loan  for  equipment,  thus  re- 
quiring the  settler  to  be  prepared  to  pay  a  sum 
ranging  from  $1,026.83  to  $1,483.17. 

(4)  Sixth  to  twentieth  year,  mclusive.    These 
payments  include  the  total  annual  instalments  on 
the  debts  for  land,  reclamation  costs,  and  farm  im- 
provements, thus  requiring  the  settler  to  pay  annu- 


Land  Settlement — United  States         217, 

ally  for  15  years  a  sum  ranging  from  $426.83  to 
$883.17. 

(5)  Twenty-first  to  fortieth  year,  mcluswe.  These 
payments  include  the  annual  instalments  on  the  debt 
for  land  and  reclamation  costs  only,  thus  requiring 
the  settler  to  pay  annually  a  sum  ranging  from 
$228.16  to  $648.50. 

While  no  debt  can  run  longer  than  40  years,  the 
proposed  law  does  provide  that  "the  purchaser  shall 
have  the  right  on  any  instalment  date  to  pay  any 
or  all  instalments  thereafter  due."  If  unprecedented 
prosperity,  therefore,  should  attend  the  efforts  of 
any  soldier  settler  so  that  he  is  able  to  accumulate 
more  money  than  he  needs  to  pay  his  regular  instal- 
ments, he  may  shorten  the  period  of  his  debt  by  pre- 
paying any  part  of  it,  thereby  saving  the  payment  of 
interest  on  the  sums  so  prepaid. 

The  plain  fact  is,  however,  that  no  farms  are  open 
to  occupancy  under  the  proposed  land  settlement 
scheme  for  soldiers.  A  land  survey  is  about  to  be 
made  to  determine  how  much  swamp  or  dry  land 
may  be  reclaimed  and  made  cultivable  by  drainage 
or  irrigation.  When  this  has  been  ascertained, 
reclamation  projects  will  provide  employment  for 
discharged  soldiers  and  others.  But  how  long  it 
will  be  before  farms  will  be  open  for  occupancy  and 
cultivation  after  these  projects  have  been  put  under 
way  can  only  be  conjectured.  When  farms  have 
been  prepared,  then  will  come  the  problem  of  meet- 


218     The  Place  of  'Agriculture  in  Reconstruction 

ing  the  financial  obligations  by  a  purchaser  of  a 
farm  as  above  outlined,  which  will  continue  for  40 
years  with  the  hardest  years  placed  at  the  begin- 
ning instead  of  at  the  end  of  a  settler's  farm  life. 

These  are  the  features  of  the  land  settlement  sit- 
uation for  returned  soldiers  in  the  United  States 
which  confront  us,  but  they  do  not  lend  much  en- 
couragement to  soldiers  with  little  or  no  capital  nor 
offer  the  prospects  of  an  immediate  increase  of  agri- 
cultural products,  which  is  the  great  need  of  the 
world  for  the  present  and  will  be  for  many  years  to 
come.  But  this  analysis  has  not  been  in  vain.  It 
should  at  least  point  the  way  to  a  scheme  of  land 
settlement  for  soldiers  which  may  not  only  be  easily 
put  into  effect,  but  which  may  necessitate  the  in- 
auguration of  a  new  land  policy  of  great  national 
importance.  The  far-reaching  economic  and  social 
effects  of  such  a  policy  require  that  it  be  treated  in 
a  separate  chapter. 


CHAPTER  IX.— A  PEOGEESSIVE  POLICY  OF 
LAND  SETTLEMENT 

If  the  preceding  pages  have  demonstrated  clearly 
one  fact,  it  is  the  close  relation  which  exists  between 
land,  labor  and  capital  to  make  farming  a  success. 
A  policy  of  land  settlement  for  soldiers  must  take 
this  fact  into  consideration.  On  the  return  of  nearly 
two  millions  of  men  from  overseas,  there  should  be 
land  ready  for  occupancy  if  any  reasonable  propor- 
tion of  those  soldiers  are  expected  to  settle  on  the 
land  and  engage  in  some  branch  of  agriculture.  If 
those  men  have  not  had  previous  experience  in  farm- 
ing, they  should  be  given  this  training  to  fit  them 
to  do  properly  their  proposed  new  life  work.  If 
they  have  little  or  no  capital  when  they  desire  to 
become  landowning  farmers,  and  if  their  previous 
experience  has  demonstrated  the  likelihood  that  they 
can  make  a  success  of  farming,  they  should  be  sup- 
plied with  land  and  capital  on  long-time  loans,  on 
easy  terms  of  repayment,  and  at  a  low  rate  of  inter- 
est. Unless  these  fundamental  conditions  are  ful- 
filled in  whole  or  in  part,  land  settlement  by  soldiers 
is  not  likely  to  succeed  as  a  state  or  national  experi- 
ment. 

219 


220     The  Place  of  'Agriculture  in  Reconstruction 

Demand  for  a  Practical  Program 

Farmers '  organizations  all  over  the  United  States 
have  recognized  the  need  of  a  practical  program  for 
agriculture  during  the  period  of  reconstruction  and 
for  a  long  time  thereafter.  The  National  Grange  at 
its  annual  meeting  held  at  Syracuse,  N.  Y.,  in  No- 
vember, 1918,  adopted  a  program  of  agricultural  re- 
construction which  included  among  other  things  de- 
mands for  reform  in  the  distribution  and  market- 
ing of  farm  products,  a  more  progressive  road  con- 
struction policy,  a  careful  consideration  of  the  land, 
fertilizer  and  rural  education  problems,  and  a  ra- 
tional method  of  providing  farms  for  soldiers. 

On  the  latter  subject  the  resolutions  declare  that 
the  National  Grange  "stands  opposed  to  the  pro- 
posed plan  of  providing  swamp  and  arid  lands,  by 
drainage  and  irrigation,  for  returning  soldiers,  as 
unsound  and  impractical  and  detrimental  to  the  best 
interests  of  the  nation  and  agriculture.  The  time 
may  come  that  will  justify  this  huge  expenditure  of 
public  funds,  but  that  time  is  not  now. 

' '  This  plan  fails  to  take  into  consideration  the  pre- 
vious occupations,  desires  or  ambitions  of  these  boys 
and  the  economic  welfare  of  established  agricultural 
communities. 

* '  There  is  an  abundance  of  unused  and  untenanted 
farms  and  available  farm  lands  near  established 
market  centers  to  supply  all  needs  in  this  direction. 


A  Progressive  Policy  of  Settlement      221 

The  government  should  offer  our  heroic  soldier  boys 
who  desire  it  such  help  as  will  enable  them  to  secure 
farm  homes  of  their  own." 

During  the  last  week  in  November,  1918,  repre- 
sentative officials  of  state  granges,  state  farmers' 
unions,  the  American  Society  of  Equity,  the 
Gleaners,  and  the  National  Non-partisan  League 
spent  several  days  in  drawing  up  a  program  of  re- 
construction to  be  submitted  for  adoption  to  all 
organizations  of  farmers  throughout  the  country. 
Among  other  things  the  statement  issued  by  these 
representatives  of  farmers '  organizations  advocated 
that  the  soldiers  and  sailors  who  were  experienced 
in  farming  or  who  were  essential  to  the  transporta- 
tion and  distribution  of  farm  products  "should  be 
discharged  first  and  provision  be  made  to  secure 
them  employment  in  agriculture  at  the  earliest  pos- 
sible moment.  Men  not  experienced  in  farming  but 
who  wish  to  farm  should  be  encouraged  to  do  so  by 
the  adoption  of  a  system  similar  to  that  which  has 
proven  so  successful  in  the  settlement  of  soldiers 
in  the  Province  of  Ontario,  Canada,  through  the  pro- 
vision of  training  for  agriculture,  with  adequate  pay- 
ment during  such  period. ' ' 

On  the  subject  of  agricultural  land  the  conference 
resolved  that  "the  present  unrestrained  system  of 
land  tenure  must  be  terminated.  Vast  holdings  of 
productive  fertile  lands  in  a  single  ownership  is 
detrimental  to  all  legitimate  agricultural  interests. 


222     The  Place  of  Agriculture  in  Reconstruction 

Tenant  farming  should  be  replaced  by  the  more  re- 
sponsible system  of  cultivation  by  owners.  Taxation 
should  be  used  as  a  remedy  to  force  into  productivity 
idle  acres  held  for  speculation. ' ' 

On  the  subject  of  farm  finance  the  conference 
urged  that  "credit  must  be  made  as  available  and  as 
cheap  to  farming  as  to  any  other  legitimate  and 
responsible  industry." 

The  form  of  credit  needed  for  soldier  farmers  is 
held  to  be  not  land  mortgage  credit,  but  personal 
short-time  credit.  No  program,  however,  of  any 
kind  is  presented  as  to  what  agency  should  furnish 
this  credit,  the  security  required,  the  time  such  loans 
should  run,  the  rate  of  interest,  or  method  of  repay- 
ment. But  while  meeting  ostensibly  for  the  purpose 
of  framing  a  program  of  agricultural  policy  during 
the  reconstruction  period  in  the  United  States,  no 
program  for  furnishing  capital  either  to  soldier  set- 
tlers or  farmers  is  presented  or  even  intimated. 
American  farmers  themselves,  as  represented  by 
their  leaders,  are  as  much  at  a  loss  to  frame  a  prac- 
tical policy  of  land  settlement  for  soldiers  as  many 
other  well-meaning  persons  who  know  little  or  noth- 
ing about  the  actual  conditions  of  American  agri- 
culture at  the  present  time  or  the  reasons  for  the 
depopulation  of  rural  districts. 


A  Progressive  Policy  of  Settlement      223 

(A  New  Land  Policy 

What  our  country  needs  is  not  the  opening  up  of 
more  land  under  reclamation  projects,  but  a  more 
general  and  better  use  of  the  land  already  capable 
of  cultivation  and  the  creation  of  conditions  which 
will  tend  to  make  farming  more  profitable  and  attrac- 
tive. It  is  useless  to  expect  men  raised  under  Ameri- 
can standards  of  living  to  continue  to  work  at  an 
industry  under  economic  and  financial  conditions 
which  threaten  to  deprive  them  of  the  larger  part 
of  the  fruits  of  their  labor  or  which  subject  their 
families  to  a  lack  of  educational  and  social  advan- 
tages to  which  they  are  justly  entitled  as  citizens  of 
the  most  progressive  nation  in  the  world.  These 
rural  life  conditions  now  prevail  in  some  parts  of 
our  country  as  a  result  of  unrestrained  land  settle- 
ment schemes,  unregulated  marketing  conditions, 
high  interest  rates  and  commission  charges  on  loans, 
excessive  taxation,  and  many  other  injustices  which 
demand  drastic  measures  of  reform. 

As  a  matter  of  fact  men  do  not  give  up  their 
farms  and  betake  themselves  to  the  towns  and  cities 
because  of  the  loneliness  of  farm  life,  the  lack  of  so- 
called  society  in  rural  districts,  and  the  remoteness 
of  farms  from  the  doubtful  "  attractions "  of  towns 
and  cities.  But  farmers  have  been  driven  from  their 
farms  because  they  could  not  make  a  respectable  liv- 
ing thereon  for  themselves  and  their  families,  or  be- 


224     The  Place  of  Agriculture  in  Reconstruction 

cause  they  have  had  them  foreclosed  over  their  heads 
by  unscrupulous  land  settlement  schemers  and 
money  lenders.  Many  a  state  to-day,  in  which  there 
are  millions  of  acres  of  cut-over  land  it  is  proposed 
to  reclaim  in  order  to  furnish  employment  to  de- 
mobilized soldiers,  has  other  millions  of  acres  of 
agricultural  land  lying  idle.  But  this  is  not  the 
worst  side  of  the  matter.  In  some  instances  the 
farmers  in  those  states  do  not  produce  enough  from 
the  land  in  use  to  provide  their  own  population  with 
necessary  food  supplies.  Let  us  take  at  random  a 
single  state  for  purposes  of  illustration. 

1.  Unused  farm  lands.  The  annual  report  of  the 
Secretary  of  the  Interior  for  1918,  page  7,  gives  a 
table  of  the  acreage  of  cut-over  lands  in  the  various 
states  that  are  available  for  reclamation.  North 
Carolina  is  said  to  have  12,745,000  acres  of  such 
lands.  But  over  against  these  acres  of  unreclaimed 
lands  there  are  about  14,000,000  acres  of  farm  lands 
lying  idle,  or  nearly  two-thirds  of  the  entire  area  of 
farm  lands  within  the  state.  The  soil  is  not  only 
being  depleted  of  its  fertility  by  washing,  but  the 
land  cultivated  in  North  Carolina  does  not  produce 
enough  to  feed  her  own  people  and  live  stock.  The 
value  of  food  and  forage  annually  imported  into  that 
state  is  about  $120,000,000.  The  following  are  the 
imports  of  the  single  agricultural  county  of  Durham : 
Corn,  1,292,000  bushels;  wheat,  119,000  bushels;  hay 


A  Progressive  Policy  of  Settlement      225 

and  forage,  1,700  tons ;  meat,  3,595,000  pounds ;  poul- 
try, 303,000  pounds ;  eggs,  445,000  dozens ;  and  but- 
ter, 1,403,000  pounds. 

This  is  a  record  of  a  single  county  of  a  state  highly 
favored  as  to  climatic  conditions,  abundant  land 
areas,  fertile  soils,  and  with  a  quarter  of  a  million 
farmers.  Why  reclaim  land  for  the  soldiers  of  North 
Carolina,  or  for  the  entire  country  for  that  matter, 
when  there  are  millions  of  acres  ready  for  the  plow 
without  digging  a  ditch  for  drainage  or  blowing  a 
stump  with  dynamite1?  The  lands  are  there  which 
could  easily  be  made  ready  for  agriculture.  If  sol- 
diers must  be  provided  with  land,  would  it  not  be 
a  wise  policy  to  take  over  the  unused  lands  and  turn 
them  into  productive  farms?  If  any  part  of  the 
lands  belong  to  the  state,  it  would  render  a  service 
to  the  soldier  and  to  the  population  to  have  the  lands 
used  in  agricultural  production.  If  the  lands  are 
privately  owned,  it  would  be  less  costly  to  purchase 
them  than  to  reclaim  an  equal  acreage  by  draining 
swamp  lands  or  clearing  cut-over  lands.  It  would 
also  result  in  saving  years  of  time  and  in  being  more 
economical  for  the  soldier  settler.  If  there  is  any 
land  settlement  problem  facing  the  American  people 
at  all,  it  does  not  relate  to  the  reclamation  of  waste 
lands,  but  to  state  or  federal  control  over  all  phases 
of  farm  land  settlement.  This  is  the  problem  which 
other  nations  have  had  to  meet  and  there  is  no  rea- 
son why  our  own  nation  cannot  do  likewise. 


226    The  Place  of  Agriculture  in  Reconstruction 

As  previously  shown  there  are  millions  of  acres 
of  farm  lands  now  held  by  private  individuals  and 
corporations.  If  these  lands  are  not  to  be  put  into 
agricultural  use  by  their  owners  but  are  held  for 
speculative  purposes,  they  should  become  public 
property  once  more.  The  amount  of  land  not  in 
actual  use  for  productive  farming  purposes  that  can 
be  owned  by  private  individuals  or  corporations 
should  be  restricted  as  is  the  case  in  Australia  and 
New  Zealand.  This  is  the  new  land  policy  which  the 
demands  of  agriculture  make  well-nigh  imperative. 

These  privately-owned  lands  should  not  be  confis- 
cated. Their  value  should  be  ascertained  by  a  com- 
mission, such  as  is  done  in  England  under  the  opera- 
tion of  the  Small  Holdings  and  Allotments  Act,  and 
the  owners  remunerated  accordingly.  By  this  policy 
no  injustice  would  be  done,  but  a  great  public  service 
would  be  rendered.  All  such  unused  farm  lands 
should  be  taken  and  used  for  the  public  good.  It 
should  be  done  without  delay,  especially  if  the  ac- 
quisition of  these  lands  is  needed  for  our  returning 
soldiers. 

But  it  is  not  at  all  unlikely  that  the  state  govern- 
ments would  be  more  or  less  handicapped  by  some 
landed  and  financial  interests  of  the  country,  the 
same  as  Canada  has  been,  if  they  should  attempt  to 
carry  out  a  radical  program  of  land  expropriation. 
As  previously  stated  Canada  had  arranged  that  the 
soldiers  should  have  priority  of  entry  on  160  or  320 


A  Progressive  Policy  of  Settlement      227 

acres  of  land.  In  addition,  the  Soldier  Settlement 
Board  had  authority  to  lend  to  accepted  settlers  up 
to  $2500  to  buy  live  stock  and  equipment  and  to  erect 
buildings.  But  on  investigation  it  was  found  that 
all  free  government  land  available  for  entry  to  sol- 
diers was  either  of  poor  quality  or  is  situated  at  long 
distances  from  railways,  schools  and  other  facilities. 
While  progress  was  made  at  first  in  making  loans  to 
returned  soldiers  who  already  had  farms,  in  in- 
stituting courses  of  agricultural  training  for  others, 
in  mapping  out  schemes  of  soldier  colonies  in  the 
Peace  Eiver  valley  of  northwest  Alberta,  and  in 
planning  reclamation  projects  and  cooperative  farm- 
ing communities,  the  board  soon  found  itself  at  a 
standstill  'because  of  a  lack  of  good  available  public 
land  upon  which  returned  soldiers  were  willing  to 
make  entry. 

This  condition  has  forced  upon  the  government  a 
new  problem  in  land  policy.  Investigation  revealed 
the  fact  that  there  are  in  Western  Canada  about 
30,000,000  acres  of  excellent  unused  agricultural 
lands  adjacent  to  railways,  communities,  and  schools. 
But  these  lands  are  owned  by  railroads,  real  estate 
corporations,  or  private  land  speculators.  The  gov- 
ernment has  been  urged  by  the  war  veterans'  asso- 
ciations to  buy  in  these  lands  for  settlement  pur- 
poses, but  the  owners  do  not  want  to  sell  except  at  a 
high  price.  The  Canadian  Pacific  Railway  Company 
and  the  Hudson's  Bay  Land  Company  are  two  of  the 


228     The  Place  of  Agriculture  in  Reconstruction 

largest  landowning  corporations.  The  veterans'  as- 
sociations demand  that  the  government  take  steps  to 
expropriate  these  lands  on  very  drastic  terms,  va- 
rious solutions  of  the  problem  being  advocated.  The 
owners  are  willing  to  sell  but  only  at  high  prices. 
The  followers  of  Henry  George,  of  whom  there  are 
very  many  among  the  soldiers,  advocate  the  single 
tax  on  land  values.  Still  others  urge  the  New  Zea- 
land system  which  requires  every  owner  of  unused 
agricultural  land  to  state  its  value  as  a  preliminary 
step  to  either  having  to  pay  a  heavy  land  tax  or  to 
have  the  land  expropriated  by  the  government  at 
the  price  named.  If  the  owner  places  a  high  value 
on  his  land,  the  tax  becomes  a  heavy  financial  bur- 
den; and  if  he  values  it  cheaply  to  escape  the  tax, 
the  government  may  buy  in  the  land  at  the  owner's 
price.  This  proposal  places  the  owner  of  unused 
land  in  a  serious  dilemma. 

In  view  of  these  conditions  Canada  faces  a  pe- 
culiar land  settlement  problem.  The  large  land- 
owning interests  will  vigorously  oppose  any  radical 
scheme  of  land  expropriation  or  land-value  taxation ; 
while  the  pressure  by  the  veterans'  associations  and 
labor  organizations  is  extremely  strong.  It  may 
take  a  year  or  two  before  this  problem  will  be 
solved,  but  sooner  or  later  drastic  action  will  be  taken 
in  the  matter  of  government  expropriation  of  un- 
used agricultural  land  in  the  Dominion  of  Canada. 
The  soldiers  frankly  declare  that  they  will  not  take 


'A  Progressive  Policy  of  Settlement      229 

up  land  in  remote  districts  while  abundance  of  good 
land  is  available  for  settlement  near  older  com- 
munities. 

The  problem  of  land  expropriation  in  the  United 
States  is  not  now  so  acute  as  it  is  in  Canada.  But 
the  various  states  may  avoid  many  difficulties  in 
the  future  if  they  begin  now  to  give  this  subject  of 
land  ownership  serious  consideration  as  a  matter  of 
great  public  importance. 

2.  Abandoned  farms.  But  in  addition  to  the  hun- 
dreds of  millions  of  acres  of  unimproved  farm  lands 
which  could  soon  be  brought  under  the  plow,  there 
are  large  numbers  of  so-called  "abandoned"  farms 
in  many  parts  of  the  country.  Many  of  these  farms 
are  in  the  Eastern  United  States.  Their  owners 
have  died,  or  have  moved  into  the  cities  to  engage 
in  industrial  work,  or  have  forsaken  their  farms 
from  some  other  cause.  It  is  a  fact,  nevertheless, 
whatever  the  reason,  that  there  are  hundreds  of  part- 
ly-equipped farm  units  ready  for  occupancy  by 
soldiers  who  may  desire  to  take  up  farming  for  a 
livelihood  in  their  own  native  localities.  Most  sol- 
diers upon  their  return  to  civil  life,  if  they  wish  to 
take  up  farming  at  all,  will  doubtless  desire  to  lo- 
cate near  their  home  localities  rather  than  to  under- 
take the  pioneer  work  of  reclaiming  virgin  land  in 
other  parts  of  the  country  where  land  settlement  or 
land  colonization  may  be  contemplated. 


230     The  Place  of  Agriculture  in  Reconstruction 

It  is  the  plan  of  our  government  to  demobilize  the 
soldiers  and  sailors  and  then  send  them  back  to 
their  homes.  What  better  plan  could  be  devised, 
therefore,  than  that  of  locating  discharged  soldiers 
on  abandoned  farms  in  their  own  part  of  the  country 
and  establishing  them  in  lines  of  agricultural  pro- 
duction to  which  they  had  been  previously  accus- 
tomed or  which  their  personal  inclinations  may  lead 
them  to  select?  Surely  the  purchase  and  reclama- 
tion of  these  abandoned  farms  could  be  made  a  prac- 
tical undertaking  by  the  government.  Their  loca- 
tion, number,  value,  and  adaptability  could  readily  be 
ascertained. 

In  view  of  the  great  demand  for  agricultural 
products  for  many  years  to  come,  especially  if  any 
number  of  returned  soldiers  should  wish  to  engage 
in  farming,  there  should  be  no  such  thing  as  an 
"  abandoned  "  farm  in  the  United  States.  A  definite 
plan  should  be  put  in  operation  by  each  state  for  get- 
ting possession  by  purchase  of  these  farms  within 
their  borders  without  delay,  of  reselling  them  to  sol- 
diers under  easy  terms  and  conditions  of  payment, 
and  of  making  a  profitable  investment  out  of  all  such 
farms. 

If  the  need  of  the  hour  demands  that  a  new  land 
policy  be  adopted  which  will  utilize  farms  and  farm 
lands  for  crop  or  livestock  production  now  held  out 
of  use  for  speculative  purposes,  or  have  been  aban- 
doned as  farm  units  by  their  present  owners,  the 


A  Progressive  Policy  of  Settlement      231 

right  of  eminent  domain  gives  the  states  authority 
to  acquire  these  properties  for  the  public  welfare. 
The  need,  however,  seems  to  be  conditional  on  a  lack 
of  land  and  farms  to  supply  the  wants  of  a  large 
army  of  demobilized  soldiers  who  are  eager  to  take 
up  farming  for  a  living.  But  at  present  there  is  no 
evidence  to  show  that  there  is  either  any  scarcity 
of  available  farm  lands  or  any  great  desire  on  the 
part  of  demobilized  soldiers  to  engage  in  fanning 
for  a  living. 

Irrigated  Farms  cmd  Farm  Lands 

The  above  is  not  only  true  as  to  millions  of  acres 
of  unused  farm  lands,  but  it  is  also  the  case  as  to 
farms  and  lands  under  actual  irrigation  projects. 
To  the  value  of  irrigated  farm  lands,  however,  must 
be  added  the  cost  charges  for  reclamation,  for  the, 
water  right,  and  sometimes  for  maintenance  charges. 
These  additional  factors  place  the  price  of  such 
farms  beyond  the  reach  of  the  average  farmer  and 
in  part  explain  why  much  land  and  many  farms  are 
still  unsettled.  Let  us  look  at  a  few  of  these  projects, 
with  a  view  of  ascertaining  the  amount  of  acreage 
open  to  occupation,  number  of  farms  unoccupied, 
cost  of  water  right,  and  other  factors  which  enter 
into  the  scheme  of  settling  soldiers  on  irrigation 
projects. 

1.  On  the  Yuma  project  in  Arizona  and  California 
there  are  18,000  acres  of  land  in  the  Gila  Valley, 


232     The  Place  of  Agriculture  in  Reconstruction 

about  55,000  acres  in  Yuma  Valley,  and  70,000  acres 
of  mesa  lands  which  will  receive  water  when  the 
irrigation  works  are  completed.  A  large  area  of 
public  land  will  be  open  to  settlement  on  the  mesa  or 
table  lands  as  soon  as  it  can  receive  water.  The 
cost  of  the  water  right  is  from  $55  to  $66  an  acre. 

2.  On  the  Uncompahgre  Valley  project  in  Colo- 
rado there  are  about  15,000  acres  of  government  land 
which  will  be  open  to  homestead  entry  as  soon  as  the 
water  distributing  system  has  been  completed.    The 
farms  will  vary  in  size  from  40  to  80  acres.    On  the 
basis  of  an  average  of  60  acres  to  a  farm,  there 
will  be  land  enough  in  this  project  for  250  farms. 
The  cost  of  water  right  on  this  project  has  not  been 
calculated. 

3.  On  the  Huntley  project  in  Montana  the  farm 
unit  varies  from  40  to  160  acres,  and  there  are  more 
than  50  farms  open  to  settlement.    The  cost  of  the 
water  right  is  $30  and  $50  an  acre.    But  as  the  lands 
are  a  part  of  the  Crow  Indian  Eeservation,  settlers 
are  required  to  pay  $4  an  acre  to  the  Indians. 

4.  On  the  Sun  Eiver  project  in  Montana  there 
are  some  farms  open  to  entry  on  the  Fort  Shaw  unit, 
the  cost  of  the  water  right  being  $36  an  acre.    An- 
other division  known  as  the  Greenfields  Bench  com- 
prises about  75,000  acres  of  land  nearly  ready  for 
opening.    On  the  basis  of  80  acres  to  a  farm  unit, 
there  will  be  land  enough  for  nearly  1000  farms  on 


A  Progressive  Policy  of  Settlement      233 

this  division  of  the  project.    The  cost  of  the  water 
right,  however,  has  not  yet  been  made  public. 

5.  On  the  North  Platte  project  in  Nebraska  and 
Wyoming  there  are  about  19  farms  open  to  home- 
stead entry  and  other  farm  lands  will  be  available 
as  the  irrigation  works  are  extended  and  completed. 
The  size  of  a  farm  is  limited  to  80  acres,  and  the  cost 
of  the  water  right  is  $55  an  acre. 

6.  On  the  Truckee-Carson   project    in    Nevada 
there  are  nearly  100  farms  open  to  homestead  entry 
and  others  will  be  available  as  the  irrigation  canals 
are  completed.    The  farms  vary  in  size  from  40  to 
80  acres,  the  cost  of  the  water  right  being  $60  an 
acre. 

7.  On  the  Belle  Fourche  project  in  South  Dakota 
there  are  a  number  of  farms  available  for  homestead 
entry  on  one  division,  and  another  division  will  be 
opened  to  homestead  entry  in  a  short  time.    The  cost 
of  the  water  right  is  $40  an  acre. 

8.  The  Shoshone  project  in  Wyoming  includes 
164,122  acres  of  land.    The  size  of  the  farms  varies 
from  40  to  80  acres  of  irrigable  land.    When  com- 
pleted there  will  be  about  2,700  farms  on  this  project. 
There  are  a  number  of  farms  now  awaiting  home- 
stead entry  and  as  these  are  taken  up  other  lands 
will  become  available  for  settlers.     The  building 
charge  is  $52  an  acre. 

The  above  is  the  merest  outline  of  the  number  of 
farms  which  are  now  available  for  settlement  under 


234     The  Place  of  Agriculture  in  Reconstruction 

existing  irrigation  projects.  It  is  needless  to  say 
that  there  are  farms  enough  in  view  on  reclaimed 
lands  to  supply  all  the  demands  by  soldiers  who  may 
wish  to  engage  in  farming  when  they  have  been 
demobilized.  When  to  the  number  of  irrigation 
farms  are  added  the  "abandoned"  farms  in  Eastern 
United  States  and  the  millions  of  acres  of  farm  lands 
which  can  be  readily  turned  into  productive  farm 
units,  there  is  no  land  problem  for  farming  purposes 
in  our  country  at  present  such  as  exists  in  France, 
Great  Britain,  and  many  other  European  countries. 
So  far  as  so-called  "reconstruction"  is  concerned, 
this  country  has  the  advantage  over  every  other 
country  from  the  agricultural  and  land  settlement 
points  of  view. 

State  Control  of  Unused  Farm  Lands 

While  there  is  no  lack  of  land  in  the  United  States 
for  farming  purposes  at  the  present  time,  this  con- 
dition might  be  brought  about  in  the  future  with 
growth  in  population.  Then  the  question  of  land 
for  farm  settlement  purposes  might  become  serious 
unless  the  various  states  begin  to  adopt  a  policy  of 
acquiring  these  lands  without  further  delay. 

In  this  regard  this  country  can  learn  a  lesson  from 
Australia  and  New  Zealand.  In  1901  the  common- 
wealth of  Australia  began  taking  over  large  tracts 
of  unused  land,  by  purchase  from  private  or  cor- 
porate ownership,  and  dividing  them  up  into  small 


A  Progressive  Policy  of  Settlement      235 

farms  for  actual  settlers.  At  the  outbreak  of  the 
European  war  Australia  had  already  purchased 
and  subdivided  more  than  3,000,000  acres  of  land 
suitable  for  crop  production  and  grazing. 

New  Zealand  began  in  1915  to  procure  tracts  of 
land  for  its  soldiers,  and  276,000  acres  were  set  apart 
for  this  purpose.  Australia  found  that  it  had  no 
public  domain  left  at  the  signing  of  the  armistice  and 
has  been  driven  to  the  necessity  of  continuing  the 
purchase  of  privately-owned  lands  for  the  settlement 
of  her  soldiers.  The  state  of  Queensland  has  pur- 
chased 500,000  acres  of  land  for  this  purpose.  New 
South  Wales  has  provided  1,500,000  acres  for  home- 
stead entry  by  soldiers,  the  title  to  be  a  perpetual 
lease  at  a  rental  of  2y2  per  cent  of  the  capital  valua- 
tion of  the  land.  The  state  of  Victoria  has  provided 
a  large  acreage  of  wheat-growing  and  irrigable 
lands  purchased  from  private  owners  for  subdivision 
and  improvement.  The  aim  of  the  Australian  and 
New  Zealand  states  is  to  prevent  the  withholding  of 
farm  lands  from  use  for  speculative  purposes  and  to 
control  all  tracts  of  privately-owned  land  above  a 
designated  limit,  which  can  be  used  for  agricultural 
production.  The  policy  is  a  progressive  one,  taking 
into  consideration  the  prospective  growth  of  the 
population  and  the  consequent  increasing  demand  for 
land  for  farming  purposes. 

In  the  United  States  the  necessity  for  state  con- 
trol of  unused  farm  lands  is  based  on  future  rather 


236    The  Place  of  Agriculture  in  Reconstruction 

than  on  present  demands  for  farms.  Even  during 
the  extraordinary  demands  of  a  world  war  there 
have  been  farms  enough  in  use  to  provide  not  only 
all  our  own  needs  for  foods  and  raw  materials  of 
manufactures,  but  also  to  aid  materially  in  supply- 
ing the  wants  of  the  allied  nations.  But  the  most 
remarkable  fact  in  connection  with  this  demand  upon 
our  agricultural  land  area  is  that  the  demand  was 
supplied  under  the  most  serious  conditions  of  a  great 
scarcity  of  farm  labor,  which  is  one  of  the  essential 
factors  in  production.  The  actual  proportion  of  men 
called  from  the  farms  to  enter  the  army  and  navy 
has  either  not  been  determined  or  has  not  been  made 
public.  The  report  of  the  Secretary  of  the  Interior 
for  1918  says  it  is  estimated  that  more  than  one- 
third,  probably  nearer  one-half,  of  our  men  who 
were  in  Europe  at  the  close  of  1918  came  from  farms. 
They  were  not  farm  owners,  but  many  of  them  were 
farm  hands  and  some  of  them  tenant  farmers.  Not- 
withstanding the  withdrawal  of  these  men  from  the 
field  of  productive  agriculture,  there  was  acreage 
enough  under  cultivation  and  in  grazing  land  to 
supply  all  our  needs. 

Evidently,  then,  if  there  is  something  wrong  with 
agriculture  which  requires  that  it  shall  be  especially 
encouraged,  or  that  men  shall  be  materially  aided  to 
engage  in  farming,  it  is  not  because  of  a  scarcity  of 
farm  land.  That  fact  is  absolutely  certain  so  far 
as  Canada  and  the  United  States  are  concerned.  For 


A  Progressive  Policy  of  Settlement      237 

present  needs  our  land  areas  are  abundant.  It  is 
doubtless  good  policy,  nevertheless,  to  be  looking 
forward  to  the  time  when  our  population  will  be 
greatly  increased,  thereby  also  increasing  the  de- 
mands upon  our  soil  resources  to  supply  our  needs 
for  foods  and  many  other  raw  materials.  If  our 
state  legislatures  do  not  awake  to  the  fact  that  they 
have  a  duty  to  perform  for  the  future  welfare  of  all 
their  people,  by  taking  over  the  unused  farm  lands, 
the  present  agitation  on  behalf  of  land  settlement  by 
soldiers  will  have  been  altogether  in  vain.  As  a 
matter  of  fact,  if  the  agitation  to  provide  farms  for 
soldiers  shall  not  result  in  increasing  at  all  the 
present  number  of  farms  and  farmers  in  the  United 
States,  it  will  have  accomplished  some  good  by  call- 
ing attention  to  our  land  policy  and  to  agricultural 
conditions  which  do  not  tend  to  promote  the  general 
welfare. 

State  Control  of  Land  Settlement 

One  of  the  greatest  present-day  evils  is  the  un- 
regulated sale  of  farm  lands  to  immigrant  and  na- 
tive settlers.  Families  without  sufficient  capital  and 
lacking  in  experience  are  induced  to  buy  land  on 
which  it  never  can  be  expected  they  will  make  a 
living,  with  the  result  that  they  ultimately  lose  all 
the  money  they  had  saved  and  then  abandon  farm 
life  forever.  Other  victims  are  then  sought  in  the 
same  way  only  to  have  such  prospective  farmers 


238     The  Place  of  'Agriculture  in  Reconstruction 

ruined  and  disheartened  sooner  or  later.  The  only 
persons  who  profit  by  this  system  of  land  settlement 
are  unscrupulous  land  owners  who  reap  a  harvest  at 
the  expense  of  others  and  who  fare  sumptuously 
every  day  while  their  victims  are  struggling  to  eke 
out  a  miserable  existence  by  cultivation  of  poor  soil. 
This  is  one  of  the  problems  of  land  settlement  which 
calls  for  action  on  the  part  of  state  legislatures  and 
which  can  only  be  satisfactorily  solved  by  state  con- 
trol. 

The  following  is  a  case  in  point  which  came  to  the 
attention  of  the  Federal  Farm  Loan  Bureau  on 
February  17,  1919: 

About  10  years  ago  a  land  settlement  company  in 
Illinois  undertook  to  establish  farm  colonies  in 
Michigan.  Two  farmers,  A  and  B,  bought  land  in 
1912  and  started  in  to  farm.  A  worked  less  than 
two  years,  spent  $2,200  in  money  he  had  saved,  and 
lost  everything  he  had  by  foreclosure  in  1914. 

The  property  was  bought  in  by  a  local  savings 
bank  operating  with  the  land  company.  This  bank 
immediately  set  to  work  to  find  another  victim.  Let 
us  call  him  C.  The  latter  was  induced  to  purchase 
the  farm  vacated  by  A,  on  which  he  settled  with  his 
family  in  the  fall  of  1914.  Here  he  farmed  and 
nearly  starved  with  his  family  until  the  summer  of 
1918,  when  foreclosure  proceedings  were  threatened. 
In  the  fall  of  that  year  an  early  frost  destroyed 
the  prospective  crops  and  to  save  the  farm  at  least 


A  Progressive  Policy  of  Settlement      239 

for  the  winter  of  1918-19  everything  was  mortgaged 
to  the  utmost — land,  live  stock  and  machinery.  Un- 
less something  unusual  in  farm  finance  happens  C 
expects  to  lose  his  farm  sooner  or  later  with  all  its 
improvements. 

Let  us  look  now  at  his  neighbor's  case.  When  B 
went  to  Michigan  he  took  over  a  farm  which  had 
been  previously  operated  by  another  farmer.  On 
this  farm  there  was  a  mortgage  for  $1,900  held  by 
the  same  savings  bank.  The  previous  owner  bor- 
rowed $500  from  the  bank,  making  his  debt  $2,400, 
and  abandoned  his  farm.  It  was  this  farm  B  was 
induced  to  buy.  He  could  not  ask  the  neighbors  any- 
thing about  the  land,  the  farm,  or  the  money  lenders, 
for  the  bank  officials  kept  him  in  the  automobile. 
The  farm  was  sold  to  B  for  $4,500,  or  nearly  double 
the  mortgage.  B  paid  down  $2,250  and  gave  a  mort- 
gage for  the  balance  at  7  per  cent  interest. 

But  B  still  had  some  money  left.  He  spent  $300 
on  a  brick  silo  and  made  some  other  improvements. 
For  nearly  seven  years  he  struggled  against  early 
and  late  frosts  and  poor  soil ;  he  increased  his  mort- 
gage from  $2,250  to  $2,300  when  the  time  came  to 
renew  it.  But  the  returns  from  the  crops  during  all 
this  time  were  not  quite  sufficient  to  cover  expenses, 
interest  and  taxes.  So  B  was  forced  to  increase  his 
mortgage  again  from  $2,300  to  $3,000.  In  1918  B 
lost  nearly  all  his  crops  by  frost,  was  taken  sick  and 
went  to  the  hospital.  He  had  to  borrow  $73  of  the 


240    The  Place  of  Agriculture  in  Reconstruction 

savings  bank  to  pay  the  year's  taxes,  but  mortgaged 
his  implements  and  live  stock  to  get  it.  The  bank 
threatened  to  foreclose.  To  save  anything  from  the 
wreck  B  sold  his  farm  for  $3,800  and  departed — an- 
other good  farmer  being  driven  from  the  land  by 
high  interest  rates  and  merciless  money  lenders. 

And  still  our  state  legislators  are  blind  to  these 
conditions,  which  are  of  common  occurrence  in  all 
parts  of  the  United  States. 

The  need  for  supervision  over  the  settlement  of 
prospective  farmers  on  land  either  publicly  or  pri- 
vately owned  has  been  vigorously  pointed  out  and 
demanded  by  Dr.  Elwood  Mead,  now  connected  with 
the  reclamation  service  of  the  Department  of  the 
Interior  and  an  enthusiast  on  land  settlement  by 
soldiers  and  sailors.  In  an  address  before  the  Fourth 
National  Congress  on  Marketing  and  Eural  Credits 
in  December,  1916,  he  said : 

"Thus  far  American  governments,  state  or  fed- 
eral, have  not  recognized  the  need  for  such  action, 
and  as  a  result  the  subdivision  of  land,  the  character 
of  the  settlers  sought,  the  price  charged  for  land, 
and  the  conditions  of  purchase  have,  on  privately- 
owned  land,  been  left  to  unregulated  private  enter- 
prise. On  public  land  there  has  been  no  scrutiny 
of  settlers  or  careful  inquiry  into  their  capital,  ex- 
perience and  purposes  to  make  certain  that  they 
would  be  capable  farmers  or  that  they  were  properly 
prepared  to  cope  with  the  obstacles  ahead  of  them. 


A  Progressive  Policy  of  Settlement      241 

In  too  many  instances  the  selfish  desires  of  land 
owners  or  colonization  agents  have  had  more  weight 
than  the  vital  needs  of  the  eager  land  seekers.  Too 
often  the  settler  has  not  been  looked  upon  as  a  hu- 
man being,  but  as  a  check-book.  His  place  in  the 
scheme  of  things  was  to  foot  the  bills ;  he  was  to  pay 
for  land,  for  irrigation  works,  and  the  profits  of 
promotion.  How  he  was  to  do  this  was  his  own 
affair. 

"During  the  past  15  years  much  of  this  movement 
to  promote  settlement  has  been  speculative ;  some  of 
it  dishonest.  Florida  swamps  and  western  deserts 
have  absorbed  altogether  too  much  of  the  savings  of 
wage  earners  to  whom  the  distant  hills  were  green- 
est. 

"Attracted  by  lurid  advertising,  many  have 
bought  without  investigation.  A  long  procession  has 
sought  Eldorados  in  the  West  and  South.  Few  were 
rich,  but  the  majority  of  families  had  from  $1,000  to 
$5,000,  which  was  more  than  they  could  afford  to 
lose  because  it  had  been  earned  by  long  years  of 
saving.  A  year  or  two  later  a  considerable  number 
of  these  same  land  seekers  drifted  back  where  they 
started  from  with  no  money  at  all.  They  had  gone 
to  new  sections  with  little  knowledge  of  local  con- 
ditions ;  with  only  a  hazy  idea  of  the  cost  of  irrigat- 
ing western  land  or  draining  southern  swamps  and 
often  with  small  knowledge  of  farming.  Those  who 
have  visited  the  homes  of  these  settlers  and  have 


242    The  Place  of  Agriculture  in  Reconstruction 

seen  their  privations  and  futile  endeavors  feel  that 
there  is  something  wrong  with  our  settlement 
methods  and  policies,  but  few  have  realized  how  far 
they  are  wrong  or  what  is  the  particular  fault." 

Now  what  is  it  that  seems  to  be  wrong  with  our 
land  policy,  both  state  and  federal?  In  the  opinion 
of  Dr.  Elwood  Mead,  based  on  his  knowledge  of  the 
settlement  of  public  irrigable  lands  of  western 
United  States,  the  difficulty  is  that  too  little  attention 
has  been  given  by  the  government  in  the  past  to  the 
character  of  the  settler  making  entry  under  our  na- 
tional homestead  laws,  to  the  fitness  of  the  land  set- 
tled upon  for  agricultural  purposes,  to  the  uncon- 
trolled settlement  of  irrigable  farms,  to  the  higher 
cost  of  these  farms  as  compared  with  the  cost  of  im- 
proved farms  in  the  Atlantic  states,  and  to  the  lack 
of  public  aid  and  control  in  the  preparation  of 
farms.  And  the  conclusion  is  reached  that  the  hope 
of  rural  progress  in  the  future  will  depend  in  no 
small  degree  upon  the  recognition  that  "land  set- 
tlement and  the  maintenance  of  the  right  conditions 
of  tenure  of  farm  lands  is  a  public  matter." 

Only  one  or  two  states  have  given  the  subject  of 
public  control  of  land  sales  and  land  settlement  any 
consideration.  The  California  State  Colonization 
Commission  has  recommended  a  plan  of  land  settle- 
ment which  makes  it  possible  for  any  farm  laborer 
or  tenant  farmer  who  is  frugal,  industrious  and  pos- 
sessed of  sufficient  initial  capital  to  ultimately  own 


A  Progressive  Policy  of  Settlement      243 

the  land  he  cultivates.  The  features  of  the  Cali- 
fornia scheme  of  land  settlement  are  the  2-acre  farm 
laborer's  allotment  and  the  size  of  farms  ranging 
from  40  to  80  acres  to  meet  the  financial  needs  of 
various  settlers.  But  the  minimum  limit  of  capital 
any  settler  must  have  to  take  up  land  in  California 
under  state  control  and  supervision  is  $1500.  The 
minimum  amount  of  capital  is  practically  limited 
to  one-tenth  the  cost  of  the  farm.  On  this  basis  the 
amount  of  capital  a  settler  will  need  before  he  can 
take  up  a  farm  will  depend  upon  its  size  and  the  cost 
of  its  proper  equipment. 

The  state  of  Wyoming  has  also  appointed  a  land 
settlement  commission  for  the  control  of  arid  public 
lands  within  that  state.  This  commission  has  rec- 
ommended that  the  development  of  these  lands  be 
undertaken  by  the  state  and  federal  authorities  act- 
ing in  cooperation ;  that  the  federal  government  con- 
struct and  operate  the  irrigation  systems ;  that  the 
state  direct  the  subdivision,  sale  and  settlement  of 
the  land  and  inaugurate  a  system  of  financial  aid 
and  practical  advice  to  settlers,  including  loans  for 
necessary  farm  improvements  at  a  low  rate  of  inter- 
est with  long-time  amortized  payments ;  and  that  the 
whole  scheme  be  so  planned  in  advance  as  to  insure 
complete  community  life  by  including  homes  for 
farm  laborers,  various-size  farm  units,  and  plans 
for  towns,  roads  and  schools. 


244    The  Place  of  Agriculture  in  Reconstruction 

Ideal  Rural  Communities 

The  suggestions  for  state  control  of  the  sale  and 
settlement  of  lands  for  farming  purposes  by  Cali- 
fornia and  Wyoming  include  plans  not  only  for  tak- 
ing over  unused  agricultural  lands,  but  also  the  crea- 
tion of  rural  communities  on  an  ideal  basis.  The 
farms  are  to  be  limited  in  size  and  the  farm  houses 
grouped  into  community  centers,  which  will  be  sup- 
plied with  all  the  advantages  of  modern  town  life 
including  electrical  plants  for  power  and  light, 
schools,  churches,  and  even  "  movie "  picture  shows. 
The  aim  is  to  begin  a  new  system  of  farm  planning 
which  will  do  away  with  the  "  loneliness "  of  farm 
life  and,  if  possible,  make  farming  itself  more 
profitable.  The  plan,  however,  is  practically  limited 
to  arid  and  semi-arid  irrigable  lands  which  may  be 
reclaimed  and  settled  under  state  and  federal  con- 
trol. 

If  public  lands  are  not  available  for  the  creation 
of  ideal  rural  communities,  privately-owned  lands 
are  to  be  taken  over  either  by  purchase  or  with  the 
consent  of  the  landowners.  In  one  way  or  another 
the  state  is  to  provide  the  land  for  settlement  pur- 
poses. These  lands  are  to  be  fitted  for  farms  by 
leveling,  ditching,  fencing  and  constructing  buildings 
thereon.  When  ready  for  occupancy  they  are  to  be 
offered  to  soldiers,  providing  that  the  prospective 
settlers  have  been  examined  and  found  to  have  suffi- 


A  Progressive  Policy  of  Settlement      245 

cient  knowledge  of  farming  and  enough  ready  money 
and  capital  equipment  to  make  a  success  of  their* 
venture. 

But  there  will  be  no  gift  or  bounty  to  the  soldiers 
in  the  form  of  land.  If  they  occupy  such  land  they 
must  pay  down  10  per  cent  of  its  value  and  the  bal- 
ance in  the  future  if  they  make  it  by  their  farming 
operations.  It  has  been  thought  that  many  patriotic 
citizens  in  some  states  who  own  land  which  is  not  in 
agricultural  use  will  be  willing  to  turn  their  land 
over  to  the  state  authorities  to  be  sold  to  soldiers 
as  settlers,  the  owners  being  willing  to  accept  pay  for 
their  land  as  the  occupants  can  make  payments 
thereon.  That  is  to  say,  the  owners  will  sell  their 
lands  to  soldiers  on  long-time  payments  through 
state  officials  acting  as  trustees  for  the  owners.  It 
is  believed  that  thousands  of  acres  of  land  in  many 
states  capable  of  being  farmed  will  be  opened  to  set- 
tlement by  returning  soldiers  without  requiring  any 
state  to  advance  the  payment  of  a  single  dollar.  In 
effect,  the  state  will  act  as  a  trustee  for  the  owners 
of  farm  lands  in  transferring  them  to  actual  soldier 
cultivators.  In  this  way  it  is  expected  many  states 
will  be  able  to  establish  and  control  ideal  rural  com- 
munities in  the  future. 

The  areas  of  land  thus  taken  over  and  controlled 
are  to  be  large  enough  to  accommodate  a  minimum 
number  of  100  settlers  to  give  real  community  life. 
The  objects  are  to  create  soldier  settlements  large 


246    The  Place  of  Agriculture  in  Reconstruction 

enough  to  have  cooperative  organizations  for  buying 
supplies  and  selling  products  and  to  provide  condi- 
tions for  economical  control  and  management.  If 
soldiers  are  settled  on  scattered  individual  farms, 
the  cost  of  supervision  is  regarded  as  prohibitive 
because  a  large  force  would  have  to  be  employed  to 
see  that  the  farmers  are  given  proper  encourage- 
ment and  advice.  Where,  however,  there  is  a  com- 
munity of  settlers,  supervision  and  direction  be- 
come a  simple  matter  and  the  cost  of  management  is 
reduced  to  the  minimum. 

The  natural  course  of  training  for  practical  farm 
ownership  is  through  the  work  of  a  farm  laborer 
and  tenant  farmer.  This  feature  is  not  disregarded 
in  the  proposed  ideal  rural  communities  of  soldier 
settlements.  Some  will  not  have  money  enough  to 
make  the  first  payments  for  an  equipped  farm  and 
will  prefer  a  home  and  an  opportunity  to  work  for 
wages  as  farm  hands.  In  many  sections  the  farm 
laborer  or  the  tenant  farmer  is  as  essential  to  rural 
communities  as  farm  owners.  Consequently,  it  is 
proposed,  as  in  the  California  land  settlement 
scheme,  to  establish  2-acre  farm  laborer's  allotments 
where  the  workers  can  provide  homes  for  themselves 
and  their  families  while  working  for  day  wages.  If 
they  can  save  sufficient  money  to  buy  farm  equip- 
ment, sooner  or  later  they  may  have  an  opportunity 
to  enter  into  tenant  partnership  with  a  landowner 
and  thereby  rise  a  little  higher  in  the  scale  of  the 


A  Progressive  Policy  of  Settlement      247 

evolution  of  a  practical  farm  owner.  Then,  when 
one  has  saved  enough  money  to  make  the  initial  pay- 
ments on  a  reclaimed  farm,  a  soldier  settler  has  the 
privilege  of  becoming  a  nominal  farm  owner  by  as- 
suming all  the  responsibilities  of  equipment,  water 
rights,  maintenance  charges,  instalments  on  his 
debts,  insurance,  upkeep  of  the  farm,  and  taxation. 
If  prosperous  soldier  settlements  under  direction  of 
the  state  can  be  established  in  this  manner,  it  is  ex- 
pected that  the  plan  will  lead  to  civilian  settlements 
of  the  same  kind. 

But  in  all  these  plans  of  progressive  land  settle- 
ment for  soldiers  there  is  no  element  of  philanthropy 
on  the  part  of  the  state  or  the  federal  government. 
Every  soldier  settler  must  be  prepared  to  pay  for 
the  land  he  takes  up  for  farming  purposes  and  on 
reclaimed  land  the  price  will  necessarily  be  high.  So 
far  as  the  granting  of  land  is  concerned,  the  soldier's 
reward  for  his  hardships,  his  sufferings,  and  his 
sacrifices  will  be  nothing.  If  the  soldier  when  de- 
mobilized faces  the  world  with  little  or  no  money  to 
his  credit,  he  had  better  shun  the  risks  of  trying  to 
become  a  farm  owner  without  first  having  the  prac- 
tical training  and  the  opportunity  of  saving  afforded 
by  work  as  a  farm  laborer  or  tenant  farmer.  When 
money  and  practical  experience  have  been  acquired, 
his  pathway  to  farm  ownership  may  be  made  easier 
and  his  prospects  for  success  far  more  promising 
than  they  would  be  if  he  plunges  impetuously  along 


248    The  Place  of  Agriculture  in  Reconstruction 

the  high  road  of  debt,  which  is  the  only  course  that 
immediate  farm  ownership  on  agricultural  or  re- 
claimed land  leaves  open  to  him. 

A  Real  Progressive  Policy 

A  progressive  policy  of  land  settlement,  there- 
fore, must  be  broadened  out  beyond  the  horizon  of 
the  present  demands  of  a  demobilized  army.  There 
is  little  apparent  need  for  such  a  policy  at  present 
except  as  a  method  of  preventing  unemployment  by 
providing  work  for  discharged  soldiers  at  current 
wages  on  vast  reclamation  schemes  in  practically 
every  state.  But  only  after  the  expenditure  of  hun- 
dreds of  millions  of  dollars  would  these  lands  be 
available  for  farming  purposes.  In  the  meantime 
hundreds  of  millions  of  acres  of  agricultural  land 
lie  idle  awaiting  the  application  of  labor  and  capital 
to  render  them  productive,  and  a  real  progressive 
policy  will  consist  in  the  state  taking  over  these 
lands  for  use  in  agriculture  before  growth  in  popu- 
lation renders  their  use  for  this  purpose  absolutely 
imperative. 

The  demand  for  a  change  of  land  policy  arises 
from  the  limited  area  of  land  that  can  be  made 
available  for  supplying  the  wants  of  an  increasing 
population.  The  power  of  the  state  should  never 
be  invoked  to  take  over  unused  agricultural  land  ex- 
cept on  the  broad  plane  of  the  needs  of  the  entire 
nation  rather  than  on  the  limited  requirements  of 


A  Progressive  Policy  of  Settlement      249 

demobilized  military  and  naval  forces,  a  small  num- 
ber of  whom  only  have  as  yet  indicated  any  inten- 
tion of  pursuing  an  agricultural  life.  The  object 
should  be  to  stabilize  land  values  and  thereby  make 
farming  more  profitable.  But  if  discharged  service 
men  are  inclined  to  take  up  agriculture  as  a  means 
of  earning  a  living,  and  if  no  element  of  philanthropy 
is  to  enter  into  the  project,  then  these  lands  should 
be  sold  at  a  cheap  price,  at  a  rate  of  interest  not 
more  than  1  or  2  per  cent,  and  on  very  long  periods 
of  time  ranging  from  40  to  75  years.  If  to  these 
terms  and  conditions  there  was  added  the  privilege 
of  prepaying  any  part  of  the  indebtedness  after  five 
years,  there  is  no  reason  why  a  settler  could  not 
make  good  on  almost  any  kind  of  land  that  could  be 
readily  cultivated. 

From  the  standpoint  of  a  state's  duty  to  her  sol- 
diers, such  a  course  is  only  a  matter  of  justice. 
Without  stopping  to  count  the  cost,  these  men  left 
all  and  followed  the  flag  of  their  country  to  the 
bloody  battlefields  of  Europe.  Many  of  them  went 
swiftly  down  the  dark  valley  of  the  shadow  of  death 
never  more  to  return ;  others  came  back  maimed  and 
disabled  for  life;  the  majority  returned  unscathed 
from  the  horrors  of  conflict,  but  with  months  and 
years  of  hardships  and  sufferings  endured  in  behalf 
of  their  country;  while  the  rank  and  file,  who  bore 
the  brunt  of  the  strife,  received  a  mere  pittance  in 
money  compensation.  And  these  are  they  who,  hav- 


250    The  Place  of  Agriculture  in  Reconstruction 

ing  gone  through  much  tribulation,  are  expected  to 
have  money  enough  saved  to  make  a  substantial  pay- 
ment for  the  land  they  may  wish  to  cultivate.  Sure- 
ly this  is  mockery  and  a  travesty  on  social  justice. 

There  is  also  an  immediate  demand  for  state  con- 
trol of  land  purchase  and  land  settlement  on  pri- 
vately-owned lands  to  prevent  such  abuses  as  those 
to  which  attention  has  been  called  by  Dr.  Elwood 
Mead.  The  whole  policy  of  some  real  estate  dealers 
is  to  fleece  the  unwary  out  of  all  their  hard-earned 
savings.  Under  date  of  January  5,  1919,  a  farmer 
wrote  to  the  Federal  Farm  Loan  Bureau  asking  how 
he  could  get  a  loan  to  save  himself  from  disaster  by 
paying  off  the  existing  mortgage  on  his  farm.  The 
terms  and  conditions  of  his  debt  he  states  as  fol- 
lows: 

"I  have  20  acres  which  I  bought  at  $300  an 
acre  in  the  rough;  it  is  irrigated  land  in  the 
Rio  Grande  valley  near  Mercedes,  Texas.  I  now 
have  it  cleared  and  in  cultivation. 

"The  price  paid  was  $6,000.  I  paid  $1,000 
cash  and  gave  two  personal  notes  for  $1,000  each, 
which  are  now  past  due,  and  on  which  I  am 
obliged  to  pay  10%  interest;  and  $3,000  in  ven- 
dor's lien  notes  due  in  1  to  5  years  with  6% 
interest.  I  have  spent  over  $1,000  for  farm 
implements  to  date.  I  would  like  to  get  money 
enough  to  pay  the  two  personal  notes  and,  if 
possible,  also  the  vendor's  lien  notes." 


A  Progressive  Policy  of  Settlement      251 

It  is  needless  to  say  what  will  happen  to  this  vic- 
tim. With  two  notes  for  $1,000  each  already  due  at 
10  per  cent  interest  running  concurrently  with  ven- 
dor's lien  notes  for  $3,000  at  6  per  cent  interest,  this 
farmer's  case  is  hopeless.  When  he  can  no  longer 
meet  his  interest  payments,  he  will  lose  his  farm 
by  foreclosure  and  all  his  life-time  savings.  It  is 
such  conditions  as  these  which  threaten  the  future 
of  agriculture  and  with  it  our  national  welfare.  And 
to  such  conditions  most  state  legislatures  are  abso- 
lutely indifferent.  A  real  progressive  policy  will 
be  inaugurated  only  when  all  such  land  settlement 
projects  are  placed  under  state  or  federal  control. 

But  apart  from  all  these  considerations  there  is 
the  broader  outlook  upon  the  growing  needs  and 
welfare  of  our  entire  population.  This  is  not  a  need 
limited  to  the  soldier  part  of  a  state's  citizens  dur- 
ing the  demobilization  period,  but  extends  to  all  the 
people  for  all  time.  The  need  is  the  future  demand 
for  agricultural  land.  This  demand  must  arise  un- 
less national  progress  is  to  be  halted.  But  if  by 
present  indifference  a  state  neglects  the  opportunity 
to  preempt  the  idle  agricultural  lands  and  to  hold 
them  in  trust  for  her  future  farmers,  the  seeds  of 
unrest  are  being  planted,  which  will  be  likely  to  bear 
fruit  in  economic  and  social  anarchy  that  now  threat- 
ens and  is  consuming  the  peace  and  prosperity  of 
the  greatest  agricultural  nations  in  the  world. 


CHAPTER  X.— THE  FUTURE  SUPPLY  OF 
FARM  LABORERS  AND  TENANT  FARMERS 

The  farm  labor  problem  is  not  the  only  one  con- 
fronting the  American  people  in  relation  to  rural 
and  national  welfare.  If  all  available  land  adapted 
to  agriculture  should  be  taken  over  by  the  state 
and  offered  to  settlers  on  much  easier  terms  and 
conditions  than  have  yet  been  proposed,  the  land 
would  be  of  no  service  in  the  production  of  food  and 
the  raw  materials  of  manufactures  except  through 
the  application  of  labor  and  capital.  The  agitation  in 
behalf  of  discharged  soldiers  is  for  the  purpose  of  in- 
creasing the  number  of  those  who  may  be  induced  to 
choose  farming  for  a  living  because  it  is  recognized 
that  there  is  a  scarcity  of  farm  labor  at  the  present 
time  and  that  a  continuance  of  this  condition  can 
only  result  in  an  increased  cost  of  the  necessities  of 
life.  Among  our  urban  population  this  could  only 
result  in  a  lowered  standard  of  living,  which  is  by  all 
means  to  be  avoided  if  possible.  There  is  a  close  re- 
lation, therefore,  between  the  supply  of  farm  labor 
and  the  economic  and  social  welfare  of  the  whole  pop- 
ulation. 

Farms  in  the  United  States  vary  in  size  and  are 

252 


The  Future  Supply  of  Farm  Laborers    258 

adapted  to  different  lines  of  production.  The  aver- 
age size  of  all  farms  is  about  138  acres.  If  a  man 
owned  a  farm  of  this  size  he  could  not  operate  it 
alone  without  injustice  to  himself  and  to  his  land. 
If  all  farmers  were  landowners,  the  size  of  farms 
would  either  be  greatly  reduced  or  there  would  be 
a  large  amount  of  farm  land  annually  kept  out  of  use, 
thereby  adding  to  the  vast  acreage  now  lying  unculti- 
vated. To  keep  this  land  in  cultivation,  therefore, 
by  means  of  hired  labor  or  tenant  farming  is  not  a 
menace  but  a  benefit  to  national  welfare. 

It  is  just  as  natural  to  expect  some  men  to  work  as 
farm  hands  or  tenant  farmers  as  it  is  to  look  upon 
day-wage  industrial  workers  or  the  piece  hands  in 
factories  as  a  usual  condition  of  modern  industrial 
life.  All  city  workers  cannot  be  factory  owners,  nor 
should  we  expect  all  rural  workers  to  be  farm  own- 
ers. Nevertheless,  farm  tenancy  is  regarded  as  a 
growing  evil,  and  the  discharged  soldier  is  expected 
to  become  a  farm  owner  though  he  might  possibly  be 
without  experience  and  without  money.  But  this,  of 
course,  is  the  height  of  folly. 

Discharged  Soldiers  as  Rural  Workers 

On  general  lines  the  men  who  entered  the  military 
and  naval  forces  may  be  classified  as  follows:  (1) 
Those  who  worked  in  rural  districts  as  farm  labor- 
ers, as  tenant  farmers,  or  as  farm  owners;  (2)  those 
who  resided  in  rural  districts  and  are  familiar  with 


254    The  Place  of  Agriculture  in  Reconstruction 

agricultural  ways  and  conditions,  but  who  have  had 
no  practical  experience  in  farming  or  stock  raising ; 
and  (3)  those  who  have  always  lived  and  worked  in 
towns  or  cities. 

With  the  demobilization  of  our  armies  the  farm 
labor  problem  ought  to  be  greatly  improved.  If  the 
statement  is  at  all  near  the  truth  that  possibly  one- 
half  or  more  of  the  men  called  into  the  military  serv- 
ice came  from  farms,  as  claimed  by  the  Secretary  of 
the  Interior,  the  problem  of  farm  labor  is  not  as  seri- 
ous as  has  been  pictured.  One  of  the  conditions  of 
demobilization  is  that  the  men  shall  be  sent  back  by 
the  government  to  the  localities  from  which  they 
came.  Farm  hands,  tenant  farmers,  and  farm  own- 
ers will,  therefore,  naturally  enter  upon  the  particu- 
lar form  of  occupation  they  left  at  the  call  of  their 
country. 

When  considered  in  relation  to  productive  agricul- 
ture, discharged  soldiers  may  be  classified  as  skilled 
and  unskilled  laborers.  They  should  not  be  placed 
on  the  same  level.  One  may  be  ready  to  take  his 
place  at  the  plow,  while  another  must  be  taught  the 
simplest  rudiments  of  farming.  One  may  readily  be 
trusted  to  use  his  knowledge  to  advantage ;  another 
must  be  trained  to  become  self-reliant.  Our  soldiers 
and  sailors  as  land  settlers  must  be  located  and  aided 
in  accordance  with  their  knowledge  or  lack  of  experi- 
ence in  rural  life. 

Of  those  who  left  farms  for  military  service,  the 


The  Future  Supply  of  Farm  Laborers    255 

majority  will  doubtless  be  only  too  glad  to  return  to 
farm  life  whether  they  were  farm  owners,  sons  of 
farm  owners,  tenant  farmers,  or  farm  laborers. 
Their  number,  status,  and  possible  location  on  farms 
after  demobilization  could  be  ascertained  without 
much  difficulty.  Moreover,  an  inquiry  by  the  com- 
manding officer  of  each  regiment  or  war  ship  could 
also  provide  information:  (1)  As  to  those  who  had 
no  practical  experience  in  farming;  and  (2)  as  to 
those  who  expected  or  desired  to  engage  in  some 
branch  of  agriculture  after  the  war. 

The  soldiers  and  sailors  who  already  had  farms  of 
their  own  or  would  locate  on  farms  of  parents  or 
relatives  need  give  the  government  little  further  con- 
cern. They  will  provide  for  themselves,  being  en- 
couraged by  the  conviction  that  they  serve  their 
country  at  the  plow  just  as  well  as  behind  the  rifle  or 
the  cannon. 

But  tenant  farmers,  farm  laborers,  and  those  who 
have  had  no  farming  experience  should  become  at 
least  temporary  wards  of  our  government.  They  are 
to  be  located  and  fitted  for  independent  civil  life. 
They  are  in  a  sense  to  begin  life  all  over  again.  They 
should  be  encouraged  with  some  form  of  government 
aid.  As  a  means  to  prevent  a  surplus  of  labor  in  cer- 
tain industries,  which  would  result  in  unemployment, 
the  American  Federation  of  Labor  in  its  reconstruc- 
tion program  has  urged  that  the  government  shall 
provide  free  transportation  of  discharged  soldiers 


256    The  Place  of  Agriculture  in  Reconstruction 

and  sailors  to  their  homes  and  the  continuance  of 
their  monthly  salaries  for  a  period  not  to  exceed 
twelve  months  if  employment  is  not  secured  by  them 
within  that  time. 

In  this  connection  there  are  doubtless  thousands  of 
farmers  who  stand  ready  to  engage  one  or  more  re- 
turning soldiers  in  some  capacity.  Farm  labor  is 
very  scarce.  It  cannot  be  expected  that  every  soldier 
will  become  a  farm  owner  without  previous  experi- 
ence. It  would  not  be  wise  for  him  to  do  so.  A  cer- 
tain period  of  training  is  desirable,  and  if  this  ex- 
perience can  be  acquired  under  the  guidance  of  some 
intelligent  and  sympathetic  farmer,  so  much  the  bet- 
ter for  the  soldier  who  will  become  a  raw  recruit  in 
his  new  calling.  There  is  frequently  the  lack  of 
money  or  the  lack  of  initiative.  A  certain  number  of 
farm  laborers  and  tenant  farmers  must  be  expected; 
This  is  especially  true  in  the  case  of  those  soldiers 
whose  homes  were  in  the  South  or  Southwest. 

It  ought  not  to  be  difficult  to  learn  the  names  of 
farmers  who  are  willing  to  take  soldiers  into  their 
homes  and  on  their  farms  until  they  have  acquired 
practical  farm  experience.  The  Department  of 
Labor  is  able  to  ascertain  without  much  difficulty  the 
number  of  farm  owners  who  are  willing  to  employ 
discharged  soldiers  as  farm  laborers,  share  crop- 
pers, or  tenants.  On  the  other  hand,  the  soldier  who 
desires  to  engage  in  farm  work  could  make  his  choice 


The  Future  Supply  of  Farm  Laborers     257 

according  to  previous  experience,  present  inclina- 
tion and  financial  condition. 

It  is  a  mistake  to  assume  that  farm  labor  and  farm 
tenancy  have  no  economic  merit.  They  often  furnish 
the  school  of  experience.  A  large  number  of  sol- 
diers will  doubtless  be  absorbed  without  delay  in  one 
or  the  other  of  the  above-mentioned  classes.  Many 
of  them,  even  if  they  possess  sufficient  capital  to 
make  a  beginning,  should  not  became  farm  owners 
at  once.  To  work  on  a  farm  as  a  day  hand  or  as  a 
tenant  farmer  would  in  many  cases  be  an  advantage 
both  to  the  soldier  and  to  agriculture.  There  will 
be  no  cessation  in  the  demand  for  agricultural 
products,  no  matter  if  every  other  industry  should 
cease.  Our  people  must  be  fed  and  clothed  during 
the  whole  time  that  our  economic  life  is  being  ad- 
justed. The  demand  for  agricultural  labor,  there- 
fore, will  be  immediate  and  constant.  Soldiers  who 
wish  it  may  be  employed  in  productive  and  profitable 
labor  as  wage  hands  or  tenant  farmers,  thereby 
helping  themselves  and  adding  to  the  wealth  of  the 
country.  This  could  not  possibly  be  the  case  if  they 
must  wait  until  they  have  hewed  out  farms  for  them- 
selves on  unreclaimed  land. 

With  these  steps  taken  and  settled,  the  remaining 
task  need  not  be  difficult.  If  some  soldiers  preferred 
to  work  as  day  laborers  on  reclamation  projects 
rather  than  as  farm  hands  they  could  be  located  in 
those  parts  of  the  country  where  such  projects  were 


258    The  Place  of  Agriculture  in  Reconstruction 

already  under  way  or  were  about  to  be  undertaken 
by  the  government  for  the  purpose  of  land  settle- 
ment. But  it  would  hardly  seem  to  be  a  wise  policy 
to  begin  new  reclamation  projects  for  the  sake  of 
providing  day-laborer  work  for  soldiers  without  any 
official  information  as  to  the  number  of  men  who  are 
desirous  of  doing  this  kind  of  work. 

If  it  is  anticipated  that  any  large  number  of  dis- 
charged soldiers  are  likely  to  want  to  become  farm- 
ers, it  would  be  more  in  line  with  their  inclinations 
and  more  useful  in  any  national  reconstruction  pro- 
gram to  have  these  men  enter  upon  the  work  of  farm 
laborers.  In  this  field  of  experience  they  would  re- 
ceive direct  training  along  lines  in  which  they  ex- 
pect to  continue  later  on  as  tenant  farmers  or  farm 
owners.  Only  in  this  way  can  it  be  anticipated  that 
an  efficient  body  of  rural  workers  will  be  developed 
from  the  hosts  of  men  discharged  from  the  army 
and  navy  of  the  United  States. 

The  letters  received  at  the  various  departments  of 
the  government  up  to  the  early  part  of  the  year 
1919  indicate  that  the  desire  of  those  who  have  had 
experience  as  farm  hands  or  tenant  farmers  is  to 
continue  in  that  capacity,  unless  they  are  to  be  given 
land  or  aided  financially  by  the  government  which 
will  enable  them  to  become  landowning  farmers.  On 
the  other  hand,  there  is  practically  no  indication  that 
any  soldier  who  has  had  farming  experience  takes 
kindly  to  the  proposition  to  work  a  long  time  as  a 


The  Future  Supply  of  Farm  Laborers    259 

day  laborer  on  reclamation  projects  in  the  anticipa- 
tion that  many  years  later  he  may  have  the  privilege 
of  buying  a  very  costly  homestead  under  conditions 
which  will  make  it  extremely  difficult  if  not  practi- 
cally impossible  for  him  to  pay  for  his  farm.  If 
given  the  right  encouragement,  therefore,  many  dis- 
charged soldiers  who  have  had  no  previous  farming 
experience  might  be  induced  to  take  up  actual  farm 
work  and  thereby  augment  the  stream  of  farm  labor- 
ers and  tenant  farmers  in  the  future. 

Economic  Aspects  of  the  Farm  Laborer 

But  why  not  adopt  the  policy  of  training  inexperi- 
enced men  in  farm  work  as  Canada  and  many  other 
countries  have  done?  Instead  of  expending  hundreds 
of  millions  of  dollars  on  new  reclamation  projects 
for  which,  so  far  as  agriculture  is  concerned,  there 
is  likely  to  be  no  demand  for  a  great  many  years, 
would  it  not  be  better  to  make  an  appropriation  to 
train  men  at  our  agricultural  schools  and  colleges? 
No  country  in  the  world  is  as  well  equipped  to  pro- 
vide practical  agricultural  education  in  all  its 
branches  as  the  United  States,  and  no  time  is  more 
favorable  than  the  present  if  any  number  of  our 
discharged  soldiers  elect  to  pursue  farming  for  a 
living. 

The  course  of  education  could  be  adapted  to  the 
future  expectations  of  the  soldier  student  and  the 
amount  of  money  in  his  possession.  If  he  has  little 


260     The  Place  of  Agriculture  in  Reconstruction 

or  no  money,  his  natural  place  is  that  of  a  farm 
laborer,  who,  in  accordance  with  economic  standards, 
occupies  a  lower  status  than  the  tenant  farmer  sim- 
ply because  of  his  lack  of  money  or  capital  equip- 
ment for  a  farm.  As  a  matter  of  fact  the  manhood 
standard  of  the  farm  laborer,  the  tenant  farmer, 
and  the  landowning  farmer  may  be  equal.  The 
economic  standard  which  differentiates  these  three 
kinds  of  farm  workers  is  based  upon  wealth  owner- 
ship only  and  not  upon  their  skill  in  the  production 
of  wealth  from  the  soil.  From  the  latter  point  of 
view,  the  farm  laborer  as  a  wealth  producer  may  be 
much  superior  to  either  a  tenant  farmer  or  a  land- 
owning farmer. 

A  six  months'  course  at  government  expense  in 
a  proper  educational  institution  would  enable  a  dis- 
charged soldier  to  acquire  the  first  principles  of 
farming  practises  so  that  he  could  take  his  place  on 
a  farm  as  an  efficient  economic  farm-labor  unit. 
Then,  with  the  acquisition  of  experience  and  by  sav- 
ing part  of  his  wages,  he  would  be  able  to  become 
a  successful  tenant  farmer  under  a  cooperative  ar- 
rangement with  the  farm  owner. 

A  discharged  soldier  with  sufficient  money  could 
become  a  tenant  farmer  as  soon  as  he  had  finished 
his  preliminary  course  of  study;  while  one  who  was 
a  farm  owner  before  he  entered  the  military  service, 
or  one  who  has  had  the  experience  and  is  pos- 
sessed of  sufficient  money  with  which  to  purchase 


The  Future  Supply  of  Farm  ^Laborers    261 

and  equip  a  farm,  could  commence  operations  with- 
out delay.  The  three  grades  of  farm  workers  would 
find  their  economic  places  in  productive  agriculture 
to  correspond  with  the  most  profitable  application 
of  land,  labor  and  capital. 

The  training  of  our  soldiers  who  may  choose  farm- 
ing for  a  living  should  be  regarded  as  a  government 
duty  as  well  as  an  economic  necessity.  Where  bil- 
lions of  dollars  have  been  expended  without  stint  for 
destructive  purposes,  it  should  be  no  hardship  on  the 
people  to  provide  a  few  millions  of  dollars  for  practi- 
cal constructive  purposes  in  fitting  men  to  take  their 
places  in  economic  and  social  life  as  efficient  farm 
workers.  It  is  well  recognized  that  population  can- 
not increase,  its  standard  of  living  be  maintained, 
or  social  progress  be  made  unless  agriculture  is  ex- 
tended. That  is,  the  demands  of  a  growing  popu- 
lation will  require  more  efficient  soil  management, 
an  extension  of  the  areas  under  cultivation,  and  a 
larger  supply  of  farm  workers.  Apart  from  the 
services  rendered  and  sacrifices  made  by  our  dis- 
charged soldiers,  which  call  for  some  sort  of  com- 
pensation in  the  way  of  agricultural  training  for 
those  who  may  desire  it,  there  is  the  broader  view  of 
national  welfare  which  demands  this  training  as  a 
matter  of  economic  and  social  necessity.  It  is  this 
aspect  of  demobilization  which  calls  for  increasing 
government  aid  to  develop  an  adequate  and  efficient 
supply  of  farm  workers  for  the  future. 


262     The  Place  of  Agriculture  in  Reconstruction 

As  previously  stated,  a  growing  amount  of  hired 
farm  labor  is  an  economic  condition  which  seems 
necessary  in  many  parts  of  the  country  if  large 
farms  are  to  be  efficiently  operated.  Even  with  an 
increase  in  the  use  of  farm  machinery,  the  skill  of  the 
farm  laborer  may  be  partly  utilized  in  other  direc- 
tions than  formerly,  but  the  demand  for  the  labor 
to  operate  the  machinery  is  not  diminished  thereby. 
Moreover,  as  new  land  areas  are  brought  into  culti- 
vation this  demand  for  farm  workers  will  increase. 
How  is  this  growing  demand  for  farm  labor  to  be 
trained  and  supplied  1  What  force  compels  men  to 
toil  on  the  land?  And  by  what  means  do  farm 
workers  pass  from  the  lower  status  of  wealth  accu- 
mulation, as  represented  by  the  farm  laborer,  to  the 
higher  status  as  represented  by  the  tenant  farmer 
or  the  farm  owner?  These  are  some  of  the  questions 
which  are  fundamental  to  a  true  conception  of  rural 
progress. 

There  is  a  tendency  to  regard  farm  tenancy  as  a 
menace  to  rural  welfare.  Nothing  could  be  farther 
from  the  truth.  The  reconstruction  program  of  the 
American  Federation  of  Labor  advocates  legislation 
to  prevent  as  far  as  possible  the  extension  of  the 
tenant  class.  A  few  years  ago  the  subject  came  up 
for  discussion  at  the  annual  meeting  of  the  American 
Economic  Association  and  the  principal  paper  ad- 
vocated state  control  of  farm  tenancy  through  the 
exercise  of  the  taxing  power.  "If  the  tax,"  said 


The  Future  Supply  of  Farm  Laborers    263 

Prof.  Paul  L.  Vogt,  "were  so  adjusted  as  to  give  a 
strong  inducement  to  the  prospective  absentee  land- 
lord to  dispose  of  his  land  to  the  prospective  tenant, 
much  of  the  speculative  holding  of  land  would  be 
quickly  eliminated  and  prices  of  land  to  prospective 
purchasers  would  much  more  nearly  equal  their  pro- 
ductive value." 

Following  out  this  idea,  the  American  Federation 
of  Labor  proposes  to  have  state  governments  es- 
tablish a  graduated  tax  on  all  usable  agricultural 
lands  above  the  acreage  actually  cultivated  by  the 
owner,  so  as  to  render  it  unprofitable  to  hold  land 
without  putting  it  to  use  and  to  prevent  the  private 
ownership  of  very  large  tracts  of  usable  farm 
lands. 

But  taxing  the  land  can  in  no  way  change  the 
economic  relations  of  wealth  production  which  deter- 
mines the  status  of  farm  workers.  The  prosperity 
of  farmers  is  measured  in  terms  of  the  wealth  pro- 
duced and  accumulated  rather  than  in  the  kind  of 
work  done  or  land  tenure  followed.  Eural  econo- 
mists hold  strenuously  to  this  position  on  the  ground 
that  the  experience  of  the  race  justifies  the  private 
ownership  of  the  wealth  actually  produced  and  saved 
by  the  worker,  be  he  farm  laborer,  tenant  farmer, 
or  landowning  farmer.  So  far  as  the  economic  as- 
pects of  the  farm  laborer  is  concerned,  the  principal 
question  to  be  answered  is,  How  can  one  increase  the 
amount  of  his  wealth  so  as  to  provide  the  means  of 


264     The  Place  of  Agriculture  in  Reconstruction 

purchasing  farm  equipment,  agricultural  land,  or 
an  equipped  farm!  And  the  answer  of  sound  rural 
economy  would  seem  to  be  by  working  as  a  farm 
hand  and  saving  the  surplus  wealth  produced. 

But  if  the  farm  laborer  does  not  or  cannot  save 
something  from  the  fruits  of  his  labor,  then  he  can- 
not very  well  purchase  land  or  a  farm.  On  the  as- 
sumption, however,  that  the  welfare  of  the  state  re- 
quires that  he  be  made  a  landowner,  this  object  can- 
not be  accomplished  unless  he  is  lifted  over  bodily 
from  one  class  into  the  other  by  means  of  state 
aid  or  private  charity.  But  such  a  course,  as  pre- 
viously intimated,  is  in  violation  of  the  most  ele- 
mentary economic  principles. 

But  to  grant  state  aid  for  any  such  policy  would 
also  violate  the  fundamental  law  of  social  progress. 
It  would  be  an  attempt  to  set  aside  the  natural  law 
of  the  struggle  for  existence ;  it  would  seek  to  coun- 
teract by  legislative  enactment  the  old  command, 
"Thou  shalt  earn  thy  bread  by  the  sweat  of  thy 
brow."  No  taxing  power  and  no  legislation  can 
change  the  economic  law  of  necessity,  which  forces 
men  to  toil  in  order  to  produce  wealth,  and  saving 
the  surplus  product  of  labor  from  the  land  is  the 
first  step  in  the  accumulation  of  property  and  justi- 
fies private  ownership. 

In  buying  and  selling  land  as  a  basis  for  farm- 
ing, the  disposal  of  the  land  to  a  farm  hand  or  to  a 
tenant  farmer  implies  that  the  purchase  price  in 


The  Future  Supply  of  Farm  Laborers    265 

whole  or  in  part  is  in  the  hands  of  the  prospective 
purchaser  as  a  result  of  saving  from  his  own  labor 
or  the  labor  of  another.  In  rural  life  this  is  a  con- 
dition which  can  economically  exist.  The  farm  work- 
er can  become  a  landowner  without  state  aid  or 
charity  in  any  degree.  It  is  not  so  much  the  price 
of  the  land  or  its  scarcity  at  present  which  consti- 
tutes the  heart  of  the  rural  life  problem,  but  it  is  a 
question  of  the  ability  of  the  worker  to  earn  and  save 
the  money  for  purchasing  land,  live  stock,  and 
equipment. 

The  only  way  to  meet  this  condition  is  by  paying 
high  wages.  On  new  reclamation  projects  it  is  pro- 
posed to  pay  discharged  soldiers  $4  a  day  in  ex- 
pectation that  they  will  save  enough  to  make  pay- 
ment on  farms  when  they  are  opened  for  settlement. 
This  is  a  recognition  of  the  principle  of  saving  as  a 
means  of  wealth  accumulation,  but  which  enables  a 
day  laborer  or  a  farm  hand  to  pass  from  this  class 
to  that  of  landowner  by  indirect  government  aid 
without  becoming  a  tenant  farmer. 

Economic  Aspects  of  Farm  Tencmcy 

But,  as  previously  pointed  out,  there  can  be  no 
successful  farming  without  a  proper  combination  of 
the  three  factors  of  land,  labor  and  capital  equip- 
ment. Where  the  cost  of  all  these  elements  is  high, 
it  is  frequently  to  the  best  interests  of  two  parties 
to  cooperate — one  furnishing  the  land  and  the  other 


266     The  Place  of  'Agriculture  in  Reconstruction 

the  labor  and  capital.  On  many  tenant  farms  both 
the  landowner  and  the  tenant  furnish  a  part  of  the 
capital  equipment.  This  is  very  common  in  the 
South,  the  share  of  the  tenant  being  regulated  ac- 
cordingly. But  this  combination  creates  the  rela- 
tion of  landlord  and  tenant  which,  in  itself,  presents 
no  menace  to  social  progress  because  two  men  agree 
to  do  what  one  man  did  before,  namely,  operate  a 
farm  for  the  production  of  wealth.  It  is  the  prin- 
ciple of  self-interest  which  actuates  tenants  to  rent 
farms.  While  a  farm  laborer  receives  returns  from 
his  labor  only,  a  tenant  farmer  receives  returns 
from  both  his  labor  and  operating  capital.  As  a 
general  result  his  income  will  be  larger,  and  this  is 
the  motive  which  leads  him  to  rent  a  farm  if  he 
owns  the  equipment  for  its  operation.  With  an  in- 
creased income  so  that  a  tenant  may  save  more,  farm 
tenancy  naturally  becomes  the  pathway  to  farm 
ownership. 

The  sharing  of  the  burden  of  carrying  on  farm 
operations  between  two  parties — one  furnishing  the 
land  and  the  other  the  labor  and  capital  equipment 
— is  in  itself  not  open  to  condemnation.  In  Great 
Britain  farm  tenancy  has  stood  the  test  of  long  ex- 
perience. "The  greatest  system  of  farming  in  the 
world, "  says  Prof.  W.  0.  Hedrick,  "measured  by  the 
test  of  endurance,  is  a  tenant  system.  In  England 
all  but  four  or  five  per  cent  of  the  farmers  are 
tenants,  yet  English  farming  has  given  us  our  lead- 


The  Future  Supply  of  Farm  laborers    267 

ing  types  of  live  stock,  our  best  farm  practises, — 
such  as  marling,  drainage,  rotations,  etc.  .  .  .  The 
test  of  a  system  of  agriculture  is  the  character  of 
its  professional  representatives ;  and  without  doubt 
the  British  farmer,  though  a  tenant,  ranks  high 
among  farmers  everywhere. ' ' 

The  system  of  farm  tenancy  based  on  absentee 
landlordism,  such  as  was  common  in  Ireland  and 
Great  Britain  not  long  ago,  is  not  only  rapidly  pass- 
ing away  in  those  countries,  but  it  has  not  taken 
root  to  any  extent  in  the  United  States.  As  a  mat- 
ter of  fact  absentee  landlordism  in  this  country  has 
a  relatively  limited  economic  and  social  range.  The 
landlord  who  leases  his  farm  to  a  tenant  is  not  a 
large  landowning  aristocrat,  but  a  retired  farmer. 
He  has  by  hard,  continuous,  intelligent  labor  pro- 
duced a  competency  from  the  soil  without  destroy- 
ing its  fertility.  He  has  preserved  for  posterity  to 
a  large  extent  the  natural  resources  of  the  soil.  He 
has  demonstrated  to  the  world  that,  under  proper 
farm  management,  agriculture  is  an  industry  which 
may  be  made  highly  profitable.  For  these  results 
the  landowner  should  be  praised  and  not  condemned. 
The  prosperous  farmer,  however,  finally  has  re- 
moved to  the  village,  town,  or  city  to  enjoy  the  fruits 
of  his  long  labors,  or  to  afford  better  educational 
facilities  for  his  family;  and  here  the  real  farm 
tenancy  problem  may  be  conceived  as  beginning. 

Farm  tenancy  may  be  examined  from  two  points 


268     The  Place  of  'Agriculture  in  Reconstruction 

of  view,  namely,  an  irrational  system  of  leasing 
farms  and  the  difficulties  of  acquiring  ownership. 

The  responsibility  for  the  exploitation  of  leased 
farms  lies  almost  entirely  with  the  owner  and  not 
with  the  tenant.  If  a  landowner  has  no  more  sense 
than  to  permit  the  fertility  or  wealth-producing 
power  of  his  land,  which  is  his  basic  or  fixed  capital, 
to  be  unscrupulously  mined  by  a  tenant,  he  is  culpa- 
bly negligent  toward  his  own  interests  and  those  of 
posterity. 

A  rational  system  of  leasing  farms, — such  as  is 
practised  in  Great  Britain,  which  favors  long-term 
tenure,  protects  the  tenant  in  his  rights  arising  from 
the  use  of  fertilizers  and  the  making  of  improve- 
ments, and  gives  the  owner  supervisory  interest  over 
the  system  of  crop  production,  rotation  and  farm 
management, — not  only  provides  a  plan  for  the  most 
efficient  and  economic  use  of  land  for  agricultural 
purposes,  but  conserves  the  natural  resources  of  the 
soil  for  future  generations. 

But  even  the  problem  of  irrational  leasing  of 
farm  lands  offers  no  serious  obstacle  to  economic  or 
social  progress  in  its  relation  to  rural  and  national 
welfare.  It  is  a  matter  of  education  and  wise  state 
legislation.  This  problem  has  been  ^solved  to  a 
large  extent  in  Italy,  Denmark,  Great  Britain,  and 
other  European  countries.  It  can  easily  be  solved 
in  our  own  country  when  it  becomes  a  real  menace. 
We  can  pass  on,  therefore,  to  consider  the  other 


The  Future  Supply  of  Farm  Laborers    269 

phase  of  the  problem,  namely,  the  difficulties  of  ac- 
quiring ownership  of  farms  by  farm  laborers  and 
tenant  farmers. 

It  would  not  be  fair  to  limit  the  discussion  of  this 
aspect  of  farm  tenancy  to  the  high  productive  states 
of  the  north  central  Mississippi  Valley  region,  where 
farm  lands  are  high  in  price.  In  view  of  the  pre- 
ceding remarks,  it  is  the  inability  of  the  farm  labor- 
er or  the  tenant  farmer  to  accumulate  sufficient 
money  with  which  to  purchase  raw  land  or  an 
equipped  farm  which  seems  to  be  the  core  of  the 
problem  of  farm  tenancy.  It  is  this  aspect  of  the 
subject  which  threatens  to  dimmish  the  supply  of 
farm  workers  in  the  future. 

The  difficulty  of  becoming  a  farm  owner,  however, 
varies  in  different  parts  of  the  United  States.  Some 
homestead  lands  of  rather  poor  quality  are  still 
open  for  settlement ;  raw  lands  in  some  parts  of  the 
country  can  be  bought  as  low  as  from  $5  to  $10  an 
acre ;  the  value  of  the  average  cultivated  farm  lands 
of  good  quality  runs  about  $75  or  $100  an  acre ;  in 
the  corn  belt  $200  an  acre  is  not  an  unusually  high 
price;  orchard  lands  in  Oregon  and  Washington 
are  frequently  estimated  at  $1,000  an  acre;  citrus 
fruit  and  walnut  orchards  in  California  are  some- 
times valued  at  $1,500  an  acre;  and  recently  a  cor- 
respondent writing  from  Florida  to  the  Federal 
Farm  Loan  Bureau  appraised  the  value  of  some 
orange  groves  at  $2,500  an  acre. 


270    The  Place  of  Agriculture  in  Reconstruction 

The  difficulties  of  passing  from  the  tenant  class 
to  the  farm-owning  class  are  intensified,  therefore, 
in  different  parts  of  the  country  and  with  different 
kinds  of  agricultural  production.  For  diversified 
agricultural  purposes,  the  man  who  buys  an  ordinary 
farm  by  paying  down  part  of  the  cash  price  assumes 
a  tremendous  responsibility  as  a  result  of  the  pre- 
cariousness  of  farming  as  an  industry,  in  meeting 
interest  charges,  in  the  payment  of  taxes,  insurance, 
and  other  expenses  involved  in  land  ownership.  On 
the  other  hand,  if  one  pays  cash  for  a  high-priced 
farm,  unless  he  is  going  into  farming  for  the  fun  of 
it,  his  course  is  one  of  doubtful  wisdom,  because, 
under  existing  economic  and  social  conditions,  he 
could  get  better  and  safer  returns  for  his  money 
if  it  were  invested  in  good  securities  at  5  or  6  per 
cent  interest. 

It  is  not  a  safe  assumption  that  passing  from  the 
tenant  class  to  the  farm-owning  class  removes  any 
of  the  difficulties  surrounding  modern  economic  and 
social  life  or  solves  the  problem  of  rural  welfare. 
As  a  matter  of  fact  it  does  not.  Under  a  fair  sys- 
tem of  leasing  farms  thousands  of  tenants  are  pro- 
viding themselves  with  an  adequate  return  for  their 
labor  and  a  moderate  investment  in  capital  equip- 
ment; whereas  thousands  of  landowners  fail  to  do 
so  as  a  return  for  their  land,  labor  and  capital  to- 
gether. In  the  South  there  are  various  grades  of 
tenant  farmers  ranging  from  those  who  are  practi- 


The  Future  Supply  of  Farm  Laborers    271 

cally  farm  laborers  with  no  accumulation  of  capital 
equipment  to  those  who  possess  sufficient  live  stock, 
farm  implements,  and  reserve  money  to  successfully 
operate  a  farm.  In  the  former  cases,  where  the 
tenants  approach  the  farm-laborer  class,  the  ele- 
ment of  cooperation  between  landowner  and  tenant 
is  that  the  latter  may  furnish  in  addition  to  labor  a 
portion  of  the  fertilizer  used  in  the  production  of  a 
crop,  while  the  landlord  may  supply  land,  equipment, 
part  of  the  fertilizer,  and  even  be  responsible  for  the 
food  requirements  of  the  tenant  and  his  family  until 
a  crop  has  been  grown.  As  a  rule  the  share  rental 
varies  according  to  the  amount  of  fertilizer  and 
capital  equipment  supplied  by  the  respective  parties 
to  the  contract.  But  where  labor  and  land  are  thus 
abundant  and  money  relatively  scarce,  the  landlord 
and  tenant  relation  has  proven  advantageous  under 
the  economic  and  social  conditions  which  prevail  in 
the  South. 

The  Secretary  of  Agriculture,  in  his  annual  report 
for  1918,  gives  some  interesting  facts  and  figures 
bearing  on  the  relation  of  tenancy  to  farm  owner- 
ship as  follows : 

"It  is  particularly  vital  that,  by  every  feasible 
means,  the  processes  of  acquiring  ownership  of 
farms  be  encouraged  and  hastened.  This  proc- 
ess is  real  in  spite  of  appearances  to  the  con- 
trary. It  has  been  too  generally  assumed  and 


272     The  Place  of  Agriculture  in  Reconstruction 

represented  that  tenancy  has  increased  at  the 
expense  of  ownership  and  that  we  are  witness- 
ing agricultural  deterioration  in  this  direction. 
Tenancy  does  present  aspects  which  should 
cause  great  concern,  but  its  bright  sides  have 
not  been  sufficiently  considered.  The  situation 
does  not  warrant  a  pessimistic  conclusion.  In 
the  30  years  from  1880  to  1910  the  number  of 
farms  in  the  United  States  increased  from 
4,009,000  to  6,362,000;  the  number  of  those 
owned  from  2,984,000  to  4,007,000,  a  gain  of 
1,023,000,  or  34.3  per  cent,  and  the  number  oper- 
ated by  tenants  from  1,025,000  to  2,355,000,  a 
gain  of  1,330,000,  or  129.9  per  cent.  But  in 
1910,  five-eighths  of  the  farms  and  68  per  cent 
of  the  acreage  of  all  land  in  farms  were  oper- 
ated by  owners  and  65  per  cent  of  the  improved 
land.  The  number  of  farms  increased  faster 
than  the  agricultural  population.  The  only  class 
not  operating  farms  who  could  take  them  up 
were  the  younger  men,  and  it  is  largely  from 
them  that  the  class  of  tenants  has  been  recruited. 
"In  a  recent  study  of  the  cases  of  9,000  farm- 
ers, mainly  in  the  Middle  Western  States  ly- 
ing in  the  Mississippi  Valley,  it  was  found  that 
more  than  90  per  cent  were  brought  up  on 
farms ;  that  31%  per  cent  remained  on  their  fath- 
ers '  farms  until  they  became  owners  and  27 
per  cent  until  they  became  tenants,  then  owners ; 


The  Future  Supply  of  Farm  Laborers    273 

that  13%  per  cent  passed  from  wage  earners 
to  ownership,  skipping  the  tenant  stage;  and 
that  18  per  cent  were  first  farm  boys,  then  wage 
earners,  later  tenants,  and  finally  owners.  It  is 
stated,  on  the  basis  of  census  statistics,  that  76 
per  cent  of  the  farmers  under  25  years  of  age 
are  tenants,  while  the  percentage  falls  with  age, 
so  that  among  those  55  years  old  and  above  only 
20  per  cent  are  tenants.  In  the  older  sections 
of  the  country  (except  in  the  South,  which  has 
a  large  negro  population),  that  is,  in  the  New 
England  and  Middle  Atlantic  States,  the  tenant 
farmers  formed  a  smaller  proportion  in  1910 
than  in  1900.  This  is  also  the  case  with  the 
Eocky  Mountain  and  Pacific  divisions,  where 
there  has  been  a  relative  abundance  of  lands. 
The  conditions  on  the  whole,  therefore,  are  not 
in  the  direction  of  deterioration  but  of  improve- 
ment. The  process  has  been  one  of  emergence 
of  wage  laborers  and  sons  of  farmers  first  to 
tenancy  and  then  to  ownership. 

"The  relative  steps  that  have  been  taken  to 
promote  better  credit  terms  for  farmers  will 
have  a  tendency  to  hasten  this  process.  The 
operation  of  the  farm  loan  system,  through  ar- 
rangements by  which  those  who  have  sold  lands 
take  a  second  mortgage  subordinate  to  the  first 
mortgage  of  the  farm  land  banks,  carrying  a 
relatively  low  rate  of  interest,  will  have  a  ben-. 


274     The  Place  of  Agriculture  in  Reconstruction 

eficial  influence.  If  further  developments  can 
be  made  through  the  application  of  the  principle 
of  cooperation,  especially  in  the  formation  of 
personal  credit  unions,  the  conditions  will  be 
more  favorable.  In  the  meantime  special  atten- 
tion and  study  should  be  given  to  the  terms  of 
tenancy,  including  the  lease  contract,  with  a  view 
to  increase  the  interest  both  of  the  landlord  and 
of  the  tenant  in  soil  improvement  and  to  make 
sure  that  there  is  an  equitable  division  of  the 
income. " 

But  assuming  that  as  a  rule  farm  ownership  is 
preferable  to  farm  tenancy,  the  question  is  how  this 
change  can  be  brought  about.  In  the  United  States 
at  the  present  time  there  is  no  difficulty  whatever 
in  one  acquiring  the  class  of  land  he  wants  to  meet 
his  financial  condition.  Let  us  look,  therefore,  at  the 
causes  of  farm  tenancy,  which  apparently  lie  deeper 
than  the  mere  price  of  land,  in  order  to  see  whether 
they  are  or  are  not  practically  within  the  reach  of 
legislative  enactment. 

The  Basis  of  the  Farm  Lai} or  Problem 

In  dealing  with  the  problem  of  farm  labor  we 
should  not  lose  sight  of  the  fact  that  fundamentally 
the  causes  are  biological  and  not  political.  Originally 
the  soil  was  the  source  of  human  slavery.  In  pro- 
curing the  means  of  subsistence  the  problems  of 


The  Future  Supply  of  Farm  Laborers    275 

life  begin;  therein  the  problems  end.  But  in  the 
course  of  life  between  the  beginning  and  the  end 
arise  all  our  economic,  social  and  political  problems. 
For  centuries  man  struggled  against  the  forces  of 
nature  which  enslaved  him  to  the  soil;  for  many 
other  centuries  he  struggled  against  his  stronger 
fellow  man  who  had  bound  him  to  the  soil.  And 
when  at  last  in  his  struggle  toward  liberty  he  found 
himself  unshackled  from  the  chains  of  chattel  slav- 
ery, it  was  only  to  realize  that  what  is  called  civiliza- 
tion, or  social  progress,  had  forged  other  chains 
about  him  which  enslave  him  none  the  less.  Neither 
the  farm  laborer,  the  tenant  farmer,  nor  the  land- 
owning farmer  is  free.  Besides  the  law  of  necessity 
which  forces  him  to  bear  the  heat  and  burden  of  the 
day,  direct  and  indirect  exploitation  deprives  him  of 
an  ever  enlarging  part  of  the  fruits  of  his  labor.  So, 
with  the  progress  of  civilization,  the  difficulty  of 
saving  is  not  lightened.  Exploitation  as  a  result  of 
economic,  social,  political,  military  and  financial 
conditions  tends  to  enslave  the  man  who  is  pro- 
ducing wealth  from  the  soil  almost  as  certainly  as 
when  under  the  bonds  of  chattel  slavery. 

The  trend  of  modern  social  life  is  for  the  in- 
dividual to  try  to  escape  as  much  as  possible  from 
the  arduous  physical  labor  of  wealth  production. 
This  is  especially  the  case  as  to  farming  with  its 
long  hours  of  labor,  often  performed  every  day  of 
the  year,  and  with  the  uncertainties  of  its  rewards. 


276     The  Place  of  Agriculture  in  Reconstruction 

When  to  these  burdens  are  added  the  disadvantages 
of  lack  of  educational  facilities,  social  isolation,  in- 
creasing taxation,  and  high  interest  rates  and  com- 
missions on  loans,  the  lot  of  the  farmer  for  a  long 
time  has  not  been  and  is  not  now  an  enviable  one. 
While  he  may  have  tried  to  escape  his  thraldom,  so- 
ciety has  made  every  effort  to  keep  him  at  his  task. 
What  the  farmer  produces  society  must  have  three 
times  a  day,  and  everything  must  be  done  to  keep 
him  at  his  hard  labor  or  society  will  suffer. 

In  contrast  with  the  farm,  the  call  of  the  town  or 
city  is  to  regular  hours  of  labor,  for  six  days  of  the 
week,  at  a  known  wage.  This  is  from  the  standpoint 
of  the  laborer  and  the  mechanic.  The  higher  the 
walks  in  business,  educational,  social,  military  and 
political  life,  the  less  physical  toil  is  required  and  the 
higher  the  rewards.  As  soon  as  they  are  old  enough 
to  leave  home,  the  easier  labor  of  business  and  pro- 
fessional life  beckons  to  our  boys  and  girls  on  the 
farm  and  they  bid  farewell  to  the  home  in  the  coun- 
try. These  beckonings  have  their  effect  in  depopu- 
lating rural  districts  and  in  overpopulating  the 
towns  and  cities. 

The  struggle  to  succeed  on  a  farm  is  becoming 
more  intense  with  the  development  of  social  life. 
The  following  letter  to  me,  which  sets  forth  the 
farm  labor  problem  from  a  tenant  farmer's  point  of 
view,  indicates  some  of  the  difficulties  which  a  farm 


The  Future  Supply  of  Farm  Laborers    277 

worker  encounters  when  he  seeks  to  become  a  land- 
owning farmer : 

"I  am  anxious  for  some  information  regard- 
ing how  to  proceed  in  getting  a  loan  for  buy- 
ing a  farm  under  the  new  farm  loan  act.  I  am 
sincere  in  this  matter,  for  at  the  present  time  I 
am  a  tenant  giving  $1  for  every  $2  that  is  made. 
I  am  farming  120  acres  for  share  rent  and  am 
also  clerk  for  our  township. 

"Serving  as  a  renter  is  up-hill  business,  for 
farm  help  is  next  to  impossible  to  get.  The  day 
laborer  is  making  more  money  than  the  renter 
at  prices  we  have  to  pay  in  the  country.  The 
workshops  and  manufacturing  places  are  offer- 
ing $3  to  $5  a  day  for  labor.  With  a  few  ex- 
ceptions the  laboring  man  is  scarce  in  our  towns. 
I  know  of  one  factory  which  has  lately  employed 
men  above  65  years  of  age  paying  them  from 
$2.25  to  $2.85  a  day.  So  you  see  the  induce- 
ments are  tempting  for  a  renter  to  leave  the 
farm.  Then  in  most  cases  the  laborers  only 
work  8  hours  and  are  done  for  the  day ;  whereas 
farmers  often  work  10  to  12  hours  and  have  2 
hours  of  chores  a  day  extra. 

"With  all  of  the  above  to  consider,  we  care 
nothing  about  leaving  the  farm  providing  we 
own  a  small  farm  of  our  own,  so  we  would  not 
be  looking  for  the  landlord  to  come  and  say 


278     The  Place  of  Agriculture  in  Reconstruction 

'More,  more';  although  it  has  never  happened 
to  me  until  now.  I  have  been  married  nine 
years  and  have  lived  nine  years  on  this  one  farm. 
But  the  owner  wants  to  farm  it  again  himself 
with  present  prices,  so  that  one  who  owns  a  farm 
has  an  advantage. 

"Now  I  will  tell  you  why  I  do  not  care  to 
move  to  town.  I  am  a  young  man  thirty-one 
years  of  age  and  in  good  health.  I  have  always 
lived  on  a  farm,  married  a  farmer's  daughter, 
and  have  two  boys.  We  do  not  care  to  take  them 
to  town  if  we  can  make  farmers  of  them,  for 
that  is  what  is  going  to  handicap  this  country. 
The  parents  are  leaving  the  farms  and  going  to 
towns  and  cities ;  and  after  that  small  boy  has 
grown  to  be  a  man  and  learned  the  city's  ways, 
there  is  very  small  hope  of  that  boy  ever  moving 
on  a  farm  again. 

"My  parents  are  owners  of  a  farm  and  also 
my  wife 's  people ;  therefore  I  can  give  the  best 
of  reference  and  security.  What  I  now  ask  for 
is :  How  do  you  go  about  it  to  get  a  federal  loan? 
Is  it  a  personal  loan  from  a  federal  bank  or  some 
other  source  1  I  wish  you  would  forward  papers 
of  instruction  at  once.  If  you  have  not  that 
power,  I  wish  you  would  forward  my  name  to 
the  proper  official  who  has  that  duty  to  fulfil. 

"I  am  very  sorry  to  take  your  time  to  read 
this  letter.  But  it  may  gain  a  point  for  you  in 


The  Future  Supply  of  Farm  Laborers    279 

your  future  work  to  know  how  there  is  one 
farmer  boy  who  is  being  forced  to  the  city,  pro- 
viding we  get  no  federal  loan  of  some  kind.  I 
can  rent  plenty  of  good  farms.  But  any  am- 
bitious man  who  has  any  business  ability  will 
not  make  a  slave  of  himself  by  being  a  good 
tenant  for  the  landowner  for  the  best  years  of 
his  life,  when  there  are  many  good  business  op- 
portunities in  view  like  there  are  at  the  present 
time.  I  suppose  there  are  hundreds  of  young 
men  who  are  successful  tenant  farmers  who  are 
now  considering  the  advisability  of  leaving  the 
farm." 

Now  there  has  been  no  scheme  of  paternalism  de- 
vised which  creates  farm  owners  out  of  farm  labor- 
ers and  tenant  farmers.  The  federal  farm  loan  sys- 
tem requires  a  borrower  to  have  farm  land  as  se- 
curity for  a  loan.  If  a  tenant  farmer  has  saved  a 
little  money  and  purchases  a  farm  by  paying  down 
his  savings  and  running  in  debt  for  the  balance,  he 
becomes  the  nominal  owner  of  a  farm.  In  that  case 
he  would  not  be  a  tenant  farmer,  but  a  poor  land- 
owner with  no  large  equity  in  his  farm.  Whether  his 
condition  would  be  improved  by  a  change  from  the 
renting  to  the  owning  class  is  highly  problematical 
in  view  of  all  the  financial  obligations  thereby  as- 
sumed. 

Evidently,  then,  the  roots  of  the  problem  of  farm 


280     The  Place  of  Agriculture  in  Reconstruction 

labor  and  farm  tenancy  lie  beyond  the  power  of  edu- 
cation and  legislation  to  reach ;  they  are  the  expres- 
sion of  natural  law  over  which  man  has  no  control ; 
before  them  the  barrier  is  raised  of  laissez  faire. 
For  primarily  our  effort  to  produce  wealth  is  a 
struggle  to  live.  To-day  bread  is  the  most  precious 
thing  in  the  world.  It  is  for  bread  that  men  work 
and  slave  from  morning  till  night  in  field  and  fac- 
tory, in  mill  and  mine,  in  bank  and  counting  house,  in 
office  and  store,  in  school  and  university — wherever 
and  whenever  there  is  a  call  to  labor  in  the  produc- 
tion of  wealth  or  in  the  performance  of  social  ser- 
vice, it  is  that  the  worker  may  earn  and  eat  his 
daily  bread.  All  other  forms  of  wealth  will  dwindle 
to  almost  nothing  in  value  if  they  cannot  purchase 
food.  It  is  the  continual  pressure  of  hunger  which 
forces  men  to  toil  on  sea  and  on  land,  and  so  long  as 
life  may  last  it  is  the  mainspring  of  effort,  of  saving, 
and  of  property. 

But  the  production  of  bread  is  by  the  sweat  of  the 
farmer 's  brow.  A  crop  must  be  coaxed  from  the 
soil  with  the  use  of  fertilizer  and  by  arduous  labor. 
Nature  may  smile  and  a  good  crop  nearly  reach  ma- 
turity only  to  be  ruined  by  excessive  rainfall.  The 
sun  may  show  a  brazen  face  week  after  week  until 
the  parched  earth  cries  out  for  water  to  drink  only 
to  be  mocked  until  the  crop  destined  for  bread  per- 
ishes from  drouth.  When  food  crops  fail  famine 
stalks  abroad  over  the  land  and  the  children  of  men 


The  Future  Supply  of  Farm  Laborers    281 

cry  from  hunger  and  finally  die.  These  are  the 
natural  conditions  against  which  the  farmer  has  to 
struggle.  And  if  to  these  conditions  society  adds 
others  which  take  from  the  farmer  an  undue  pro- 
portion of  the  returns  from  his  labor,  his  induce- 
ments to  work  on  a  farm  grow  less  and  less  until  at 
last  he  gives  up  in  despair.  Surely,  then,  when  agri- 
culture wanes  the  welfare  of  mankind  wanes  also. 

But  when  it  comes  to  a  consideration  of  the  effects 
of  poorly-paid  farm  laborers  and  of  over-burdened 
tenant  farmers  on  the  welfare  of  rural  communities, 
it  is  the  duty  of  society  through  wise  legislation  to 
adopt  policies  which  shall  make  farm  life  under 
future  conditions  profitable,  healthful  and  attrac- 
tive, and  which  shall  insure  the  greatest  good  to  the 
state  by  maintaining  a  sufficient  supply  of  farm  labor 
and  conserving  the  fertility  of  the  soil.  Only  by 
making  farm  work  more  attractive  and  more  profit- 
able by  eliminating  various  elements  of  exploita- 
tion can  the  state  expect  to  provide  an  adequate 
supply  of  efficient  farm  labor  in  the  future. 

These  are  the  conditions  concerning  the  three 
grades  of  farm  workers,  which  should  be  taken  into 
consideration  in  any  scheme  of  land  settlement  for 
soldiers  and  sailors.  The  labor  or  tenure  status  of 
any  person  taking  up  farming  for  a  living  is  de- 
pendent upon  his  experience  and  the  amount  of 
money  or  capital  equipment  in  hand.  There  is  no 


282     The  Place  of  Agriculture  in  Reconstruction 

hope  of  contentment  and  success  at  farming  on  any 
other  basis. 

If  our  discharged  service  men  are  to  furnish  a 
supply  of  efficient  and  satisfied  farm  workers  for  the 
present  and  growing  needs  of  the  agricultural  indus- 
try, they  must  be  trained  for  the  work  and  must  oc- 
cupy that  status  which  conforms  to  their  inclina- 
tion, their  ability,  and  their  capital.  To  grant  sol- 
diers free  land  without  taking  into  consideration  all 
the  factors  which  make  for  success  in  modern  farm- 
ing would  be  to  invite  such  a  social  disaster  as  befell 
Borne  when  that  commonwealth  undertook  to  carry 
out  such  a  policy.  In  the  face  of  all  past  experience 
of  agricultural  nations,  such  a  policy  could  only  be 
branded  as  the  worst  kind  of  political  folly. 


CHAPTER  XL— THE  SOURCES  OF  CREDIT 
FOR  SUCCESSFUL  AGRICULTURE 

The  financing  of  agriculture  has  always  been  a 
serious  problem.  The  establishment  of  the  federal 
farm  loan  system  in  1916  was  only  accomplished 
after  several  years  of  preliminary  investigation  and 
legislative  effort.  This  plan  of  farm  mortgage 
credit  now  in  operation  is  still  in  a  formative  con- 
dition and  subject  to  many  amendments.  It  was 
devised  to  supply  credit  only  to  farmers  who  were 
able  to  give  a  first  mortgage  on  farm  lands  as  se- 
curity for  a  loan. 

For  any  national  scheme  of  land  settlement  as  that 
proposed  by  the  Department  of  the  Interior  in  be- 
half of  demobilized  soldiers  and  sailors,  the  present 
federal  farm  loan  system  would  have  little  or  no 
place  because  our  discharged  service  men  are  most- 
ly to  be  considered  as  without  land  and  without  suffi- 
cient money  to  establish  themselves  on  farms.  As 
a  rule  they  could  be  regarded  only  as  the  prospec- 
tive labor  element  in  productive  agriculture.  But 
even  as  a  labor  factor,  unless  many  of  them  are  given 
a  preliminary  agricultural  training,  our  discharged 
service  men  could  not  be  regarded  as  efficient  farm 

283 


284     The  Place  of  Agriculture  in  Reconstruction 

workers.  If  they  are  to  be  made  landowning  farm- 
ers at  the  outset,  they  must  be  provided  with  both 
land  and  capital. 

Financial  Prospects  on  Reclamation  Projects 

Practically  the  only  plan  of  making  farmers  out  of 
our  soldiers  is  that  advocated  by  the  Department  of 
the  Interior.  But,  as  previously  stated,  this  is  pri- 
marily to  furnish  work  by  reclaiming  waste,  swamp, 
irrigable  or  stump  lands  which  are  ultimately  to  be 
cut  up  into  farms  and  sold  to  settlers  on  what  is 
believed  to  be  easy  terms.  How  many  years  it  will 
take  to  fit  these  lands  for  farming  has  not  even  been 
conjectured.  The  time  element  in  the  problem  has 
been  given  little  or  no  consideration. 

On  any  such  contemplated  scheme  as  that  of  land 
settlement  on  a  reclamation  project,  the  farmer  faces 
a  most  stupendous  and  hazardous  undertaking.  If 
soldiers  as  settlers  do  not  own  land  and  capital,  the 
financial  problem  is  to  provide  long-time  loans  for 
the  payment  of  the  land  and  short-time  loans  for 
the  purchase  of  equipment.  Even  on  the  assump- 
tion that  sufficient  abandoned  farms  and  unused  agri- 
cultural land  could  be  provided  for  discharged  ser- 
vice men  who  wish  to  take  up  farming  for  a  living, 
only  half  the  problem  has  been  solved.  So  far  as 
financing  agriculture  is  concerned,  one  of  the  great- 
est tasks  is  to  provide  the  necessary  capital  for  the 
proper  equipment  of  the  farms  to  be  brought  into 


Sources  of  Credit  for  Agriculture        285 

cultivation.  For,  without  equipment,  land  and  labor 
are  of  little  use  in  the  production  of  wealth.  In  the 
case  of  land  settlement  by  soldiers,  the  problem  evi- 
dently centers  in  a  program  for  furnishing  suffi- 
cient credit  to  enable  them  to  engage  in  farming 
with  at  least  the  prospect  of  earning  a  living  and  of 
winning  a  measure  of  success. 

But  the  undertaking  is  so  vast  both  as  to  land 
areas  to  be  reclaimed  and  the  capital  requirements, 
that  it  is  evidently  beyond  the  possibility  of  realiza- 
tion by  any  corporation  or  syndicate  of  corporations. 
If  it  is  to  be  undertaken  at  all,  this  must  be  a  gov- 
ernment matter.  Since  there  is  no  argument  in  its 
favor  as  a  means  of  providing  farm  land  quickly  for 
crop  production,  the  proposed  national  reclamation 
projects  are  justified  on  the  ground  that  it  is  a  mat- 
ter of  public  concern  to  provide  work  for  discharged 
soldiers  and  to  aid  in  limiting  unemployment.  A 
problem  so  vast  can  only  be  adequately  financed  by 
government  initiative.  Hence  various  bills  have 
been  introduced  into  Congress  which  would  authorize 
the  expenditure  of  public  funds  for  reclamation  pur- 
poses ranging  from  $100,000,000  to  $500,000,000. 
But  all  this  vast  amount  of  work  and  expenditure  of 
funds  would  be  preliminary  to  the  establishment  of 
a  rural  credits  system  for  financing  the  settlers  to 
enable  them  to  purchase  reclaimed  land  for  farms 
and  for  necessary  equipment. 

The  cost  of  reclamation  expenditures  necessarily 


286     The  Place  of  Agriculture  in  Reconstruction 

adds  to  the  cost  of  the  land.  A  commission  which 
studied  the  conditions  of  land  reclamation  and  set- 
tlement in  the  West  not  long  ago  reported  what  it 
would  cost  to  properly  equip  farms  on  public  land 
for  irrigation.  The  following  is  presented  as  the 
cost  for  a  farm  of  80  acres : 

Leveling  land,  building  checks  and  small  ditches $2,500 

House  and  barn   1,500 

Work  team  and  tools 1,000 

Living  expenses  for  one  year 500 

Taxes,    operation    and   maintenance    charges,    and    incidental 

expenses    300 

Initial  payment  on  water  right 200 

Dairy  herd  and  other  live  stock 2,000 

Total    $8,000 

The  above  schedule  gives  an  approximate  valua- 
tion of  $100  an  acre  for  reclamation  and  equipment 
of  land  in  order  to  fit  it  for  farming  purposes.  But 
this  class  of  lands  is  worthless  without  water,  so 
that,  when  the  ultimate  cost  of  a  water  right  of 
about  $50  an  acre  is  added,  experience  has  shown 
that  it  costs  not  less  than  $150  an  acre  to  make  farms 
ready  for  cultivation  on  some  irrigation  projects  and 
pay  for  the  water  right. 

It  is  this  formidable  financial  problem  which  must 
be  faced  in  undertaking  to  furnish  credit  to  de- 
mobilized soldiers  who  wish  to  farm.  There  is  no 
charity  in  the  proposition  in  the  form  of  gratuitous 
government  aid.  Every  dollar  of  expenditure  will 
be  exacted  with  interest.  And  no  soldier  can  hope 
for  such  a  farm  unless  he  has  enough  money  saved 


Sources  of  Credit  for  Agriculture        287 

to  pay  down  at  least  one-tenth  of  the  cost.  The  fol- 
lowing is  an  official  presentation  of  the  necessary 
requirements  for  a  settler  on  a  reclamation  project : 
"No  settler  without  money  should  be  accepted. 
The  average  soldier  is  not  a  superman.  The  task 
of  improving  and  paying  for  a  farm  without  any 
capital  is  a  task  which  requires  superior  qualifica- 
tions. Every  settler  needs  also  a  little  reserve  money 
for  accidents  and  misfortunes.  He  needs  a  part  of 
the  investment  on  which  he  does  not  have  to  pay 
interest.  Furthermore,  it  will  be  unsafe  for  the  gov- 
ernment to  intrust  valuable  property  to  men  who 
have  no  money  risk  and  who  could  abandon  it  with- 
out losing  anything.  Many  of  these  soldiers  will  be 
restless,  made  so  by  their  war  experiences ;  to  them 
distant  hills  will  look  green.  In  their  own  interest 
they  need  to  be  anchored,  to  have  some  stabilizing 
influence,  and  the  most  potent  is  to  have  some  money 
invested  that  they  will  lose  if  they  abandon  their 
undertaking.  The  possession  of  money  indicates 
ability  to  earn  it  and  to  save  it,  and  the  settler  must 
have  both  these  virtues  to  succeed.  The  capital  a 
settler  should  be  required  to  have  ought  to  have 
some  relation  to  the  cost  of  the  improved  farm.  In 
Denmark  the  settler  must  provide  $1  for  $9  that  the 
government  furnishes.  That  is,  he  furnishes  one- 
tenth  of  the  cost.  In  Australia  some  of  the  states 
provide  that  the  settler  must  have  $1,500  capital, 
and  that  is  the  minimum  limit  of  capital  in  Call- 


288    The  Place  of  'Agriculture  in  Reconstruction 

fornia.  But  if  we  say  he  must  furnish  one-tenth 
of  the  cost  of  the  farm,  then  the  amount  of  capital 
will  depend  upon  the  size  of  the  farm  and  the  money 
required  to  equip  it."1 

In  view  of  the  cost  of  a  reclaimed  farm,  it  is  not 
at  all  surprising  that  57  per  cent  of  settlers  fail  and 
move  away,  while  the  other  43  per  cent  have  to  work 
hard  and  continually  in  order  to  make  a  living.  The 
percentage  of  failures  is  not  only  large,  but  it  is 
tragical  in  that  those  who  abandon  their  holdings 
have  usually  wasted  years  of  time  and  lost  all  their 
previous  savings.  Many  of  them  remove  to  the  cities 
to  join  the  host  of  unskilled  laborers  or  to  be  so- 
cially submerged  after  a  vain  struggle  to  eke  out  a 
me.re  existence.  It  is  this  aspect  of  soldier  settlement 
on  reclaimed  lands  which  must  be  faced  years  hence 
when  the  farms  have  finally  been  prepared  for  oc- 
cupancy. It  is  a  problem  of  great  importance  to 
successful  agriculture  in  the  future.  How  many  of 
past  failures  have  been  due  to  the  financial  exploita- 
tion of  the  settlers  will  probably  never  be  told. 

Rural  Credits  for  Returned  Soldiers 

The  most  striking  feature  of  land  settlement 
schemes  for  soldiers  is  the  utter  lack  of  any  ade- 
quate system  for  furnishing  capital  and  credit.  With 
the  high  cost  of  farms,  the  cash  requirements  before 

^'Reclamation  Record,"  December,  1918,  p.  556. 


Sources  of  Credit  for  Agriculture        289 

occupancy,  the  comparatively  short  time  for  the  re- 
payment of  loans,  and  the  high  interest  rates,  there 
is  more  likelihood  that  the  average  soldier  settler 
will  fail  rather  than  succeed.  Already  in  England 
two  of  the  soldier  settlement  colonies  have  practi- 
cally failed.  Under  the  conditions  of  settlement  pro- 
posed for  our  soldiers,  the  chances  of  success  are 
all  against  them.  If  past  experience  in  the  financing 
of  agriculture  has  any  lesson  at  all  for  us  it  is  that 
many  of  the  above  conditions  must  be  changed  to 
make  settlement  by  soldiers  on  reclaimed  lands  a 
success.  A  system  of  rural  credits  must  be  devised 
which  will  be  unique  in  American  farm  finance.  The 
debt  we  owe  to  our  ex-service  men,  as  well  as  the  im- 
portance of  agriculture  to  national  development  and 
welfare,  requires  that  this  should  be  done  unless  our 
country  is  to  disappoint  those  who  are  appealing  for 
an  opportunity  to  earn  their  daily  bread. 

But  the  subject  of  credit  is  important  whatever 
kind  of  land  a  soldier  may  take  up  for  farming  pur- 
poses. Both  the  land  and  operating  capital  will  in 
the  majority  of  cases  have  to  be  supplied  by  the 
government  on  a  credit  basis;  for  the  letters  writ- 
ten by  soldiers  making  inquiry  about  government 
farm  loans  state  candidly  enough  that  they  have  no 
money  with  which  to  purchase  land  or  to  equip  it  for 
either  cultivation  or  stock  raising.  If,  then,  the  gov- 
ernment proposes  to  aid  these  men  to  become  farm 
owners  after  they  have  acquired  sufficient  knowledge 


290     The  Place  of  Agriculture  in  Reconstruction 

to  carry  on  farming  operations,  loans  should  be 
made  on  the  easiest  possible  terms  and  conditions. 

In  the  absence  of  any  government  plan  of  financing- 
ex-service  men,  the  general  practise  has  been,  when 
letters  of  inquiry  were  sent  by  soldiers  to  the  various 
departments  of  the  government,  to  refer  them  for 
reply  to  the  Federal  Farm  Loan  Bureau.  But  the 
federal  system  of  rural  finance  would  be  of  no 
practical  assistance  to  soldier  settlers  who  are  not 
landowners.  It  provides  only  for  farm  mortgage 
loans  up  to  50  per  cent  of  the  appraised  value  of  the 
land,  for  periods  of  time  not  less  than  5  years  nor 
more  than  40  years,  and  at  an  interest  rate  as  high 
as  6  per  cent.  The  federal  land  banks  now  operating 
under  this  system  are  making  loans  at  5%  per  cent, 
but  most  of  the  joint  stock  land  banks  are  making 
loans  at  6  per  cent.  It  does  not  aid  the  man  without 
money  and  without  land  to  become  a  landowner  or 
to  equip  his  land. 

Nor  would  a  settler  be  likely  to  succeed  under  the 
terms  and  conditions  of  loans  of  the  federal  farm 
loan  system.  It  is  not  sufficiently  flexible  to  aid  a 
farmer  who  is  struggling  to  establish  himself  on  the 
land  in  the  face  of  insect  pests,  animal  diseases,  in- 
fertile soils,  natural  forces,  heavy  taxation,  and  a 
comparatively  high  interest  rate.  These  are  the  bur- 
dens which  drive  men  from  farms  into  the  cities 
rather  than  the  loneliness  of  farm  life,  and  the  fed- 
eral farm  loan  system  is  not  prepared  to  meet  them 


Sources  of  Credit  for  Agriculture        291 

with  suitable  terms  and  conditions  of  loans  for 
soldier  settlers.  An  entirely  new  system,  therefore, 
must  be  devised  which  will  at  least  offer  a  promise 
of  success  to  the  prospective  settler.  It  should  pro- 
vide both  mortgage  and  personal  credit  facilities  on 
very  long  time  and  at  low  rates  of  interest. 

France  proposes  to  make  loans  to  her  soldiers  at 
1  per  cent  interest.  Shall  the  United  States,  which 
has  become  the  creditor  nation  of  the  world,  do  less 
for  her  soldiers  than  heroic  France!  On  July  1, 
1918,  our  total  interest-bearing  debt  was  $11,985,- 
882,436,  and  from  that  date  to  the  close  of  the  year 
the  disbursement  of  the  Treasury,  exclusive  of  pay- 
ments on  the  public  debt,  was  nearly  $11,000,000,000 
more,  or  at  the  enormous  rate  of  about  $22,000,000,- 
000  a  year.  Of  the  actual  amount  expended  during 
the  last  six  months  of  1918,  the  sum  of  $2,047,986,- 
697  was  loaned  to  foreign  governments.  During 
these  six  months  the  government  expended  about 
$9,000,000,000  for  war  purposes,  from  which  there 
will  be  no  returns  in  interest  and  which  enormous 
debt  must  itself  be  repaid  since  it  represents  in  large 
part  money  borrowed  from  the  public  by  the  sale 
of  bonds.  These  enormous  expenditures  to-day  are 
only  in  a  small  degree  represented  by  tangible  prop- 
erty values.  The  bulk  of  it  has  been  spent  for  de- 
structive and  not  constructive  purposes.  It  repre- 
sents a  financial  burden  which  future  taxation  can 
alone  redeem. 


292     The  Place  of  Agriculture  in  Reconstruction 

But  if  one-tenth  of  the  amount  of  money  expended 
by  our  government  for  war  purposes  were  set  aside 
for  investment  in  unused  farm  lands  and  in  farm 
equipment,  it  would  represent  a  concrete  property 
value  to  the  full  extent  of  the  expenditures.  If 
money  were  loaned  to  our  discharged  soldiers  and 
sailors  free  of  interest  in  order  to  encourage  the  de- 
velopment of  agriculture,  would  it  be  any  more  than 
these  gallant  sons  of  America  deserve  ?  The  govern- 
ment could  be  protected  against  loss  by  means  of 
land  mortgage  and  chattel  mortgage  security,  and 
if  it  made  no  profit  out  of  the  transaction,  it  would 
at  least  be  sure  of  the  return  of  its  capital  invest- 
ment because  the  property  values  would  always  be 
greater  than  the  amount  of  money  the  government 
had  invested  therein.  This  cannot  be  said  of  the 
eighteen  billions  of  dollars  expended  during  the  year 
1918,  which  vast  sum  represents  little  property  value 
and  has  served  no  very  useful  purpose  to  the  nation 
as  a  whole.  But  if  the  government  should  charge 
our  discharged  soldiers  1  or  2  per  cent  interest  on 
loans,  it  is  the  highest  rate  of  interest  which  should 
be  exacted  in  view  of  the  great  service  these  men 
have  rendered  to  our  country,  to  other  nations,  and 
to  the  cause  of  civilization. 

There  is  a  precedent  already  established  for  the 
lending  of  money  by  the  government  free  of  interest 
to  encourage  agricultural  development  and  to  pro- 
mote farm  mortgage  credit.  When  the  federal  farm 


Sources  of  Credit  for  Agriculture       293 

loan  system  was  authorized  by  Congress  in  1916,  the 
government  subscribed  for  capital  stock  in  the  fed- 
eral land  banks  to  the  amount  of  nearly  $9,000,000. 
But  the  farm  loan  act  provides  that  "  stock  owned 
by  the  government  of  the  United  States  in  federal 
land  banks  shall  receive  no  dividends. ' '  This  amount 
of  money,  therefore,  is  practically  advanced  without 
interest,  since  there  can  be  no  returns  thereon  to 
the  government  no  matter  how  large  may  be  the 
profits  made  by  the  federal  land  banks.  Why,  then, 
should  there  not  be  a  similar  procedure  in  the  case 
of  our  disabled  and  discharged  soldiers  and  sailors 
whose  services  and  sufferings  can  never  be  ade- 
quately measured  in  terms  of  money  remuneration  in 
loans  at  a  low  interest  rate  or  even  without  interest? 
Summing  up  the  situation  of  rural  credits  for  re- 
turned service  men,  a  system  should  be  devised  which 
will  provide  both  long-time  mortgage  credit  and 
short-time  personal  credit.  From  the  experience  of 
other  nations,  the  requirements  of  the  men  who  may 
engage  in  agriculture,  and  the  promotion  of  both 
rural  and  national  welfare,  the  following  outline 
of  a  system  is  suggested : 

1.  Long-time  or  mortgage  credit.  The  basis  of 
long-time  credit  is  the  land.  The  two  important 
questions  relating  thereto  in  connection  with  land 
settlement  by  soldiers  on  a  national  scale  are : 


294     The  Place  of  Agriculture  in  Reconstruction 

(1)  The  amount  of  money  the  settler  should  be 
required  to  pay  down. 

(2)  The  length  of  time  the  loan  shall  run. 

A  payment  is  necessary  in  order  to  establish  an 
equity  in  the  property.  Without  a  sense  of  owner- 
ship an  occupier's  interest  in  farming  may  soon 
wane.  A  payment  down  'gives  the  feeling  of  owner- 
ship, and  this  has  always  been  the  lodestone  which 
holds  people  to  rural  life. 

But  the  payment  required  should  not  be  large. 
The  sum  to  be  deposited  under  the  California  land 
colonization  scheme  is  altogether  too  high  to  render 
such  a  plan  operative  for  demobilized  soldiers. 

Probably  the  Danish  government  plan  of  establish- 
ing farm  laborers,  tenants  and  soldiers  on  the  land 
as  owners  would  be  best  adapted  to  the  conditions 
which  will  confront  us  during  and  for  a  long  time 
after  the  period  of  demobilization.  Practically  there 
will  be  going  on  a  gradual  reconstruction  of  our 
economic  relations  and  also  of  the  agricultural  in- 
dustry. 

The  Danish  system  provides  for  the  advancement 
of  money  or  credit  to  as  high  as  90  per  cent  of  the 
land  value.  That  is  to  say,  the  borrowing  settler  is 
required  to  pay  at  least  10  per  cent  of  the  cost  price 
of  the  farm  or  of  the  value  of  raw  land.  It  may  not 
be  advisable  to  require  a  less  payment  by  soldiers 
who  take  up  farms  under  government  direction. 

The  period  of  time  loans  may  run  is  up  to  75  years. 


Sources  of  Credit  for  Agriculture        295 

No  payment  is  required  on  loans  for  the  first  5  years, 
a  low  interest  rate  is  charged,  and  loans  are  repaid 
by  amortization.  These  features  give  a  flexibility 
to  the  Danish  system  which  meets  the  financial  con- 
ditions of  the  various  classes  of  settlers  and  would 
be  especially  applicable  to  soldiers  who  have  had 
farming  experience  and  are  desirous  of  becoming 
landowning  farmers. 

A  modified  form  of  the  amortization  plan  of  re- 
paying loans  should  be  adopted,  which  will  satisfac- 
torily meet  the  needs  of  soldiers.  The  period  of 
adaptation  to  their  new  conditions  of  life  will  neces- 
sarily be  hard.  It  will  be  a  constant  struggle  to 
meet  operating  expenses  during  the  first  few  years 
on  a  farm.  If  interest  is  charged  at  all  on  loans  it 
should  be  at  not  more  than  1  or  2  per  cent,  and  only 
the  interest  on  the  loan  should  be  required  during  the 
first  5  years.  But  if  the  financial  condition  of  any 
settlers  warrants  them  doing  so,  instalments  on  the 
debt  may  be  paid  at  any  time  earlier.  After  5  years 
regular  amortized  payments  on  the  loan  should  be 
required  the  same  as  under  the  Danish  and  French 
systems. 

In  case  of  crop  failure,  loss  of  live  stock,  or  other 
misfortune,  only  interest  on  the  loan  should  be  re- 
quired at  any  time  during  the  period  of  the  loan. 
Even  interest  might  be  allowed  to  run  for  a  certain 
length  of  time  in  exceptional  cases.  In  other  words, 
every  encouragement  should  be  given  to  the  soldier 


296    The  Place  of  Agriculture  in  Reconstruction 

settlers  to  remain  on  the  land  and  every  safeguard 
thrown  around  them  for  their  protection. 

Since  loans  may  run  for  75  years,  the  annual  in- 
stalments thereon  will  necessarily  be  small  and  will 
constitute  no  hardship  under  ordinary  conditions 
of  farming.  So  far  as  land  mortgage  credit  is  con- 
cerned, there  are  no  difficulties  which  cannot  easily 
be  overcome  in  the  settlement  of  soldiers  on  the 
land. 

The  plan  worked  out  for  this  purpose  should  be 
absolutely  independent  of  the  present  federal  farm 
loan  system.  As  now  operated  that  system  was  es- 
tablished to  enable  existing  farm  owners  to  pro- 
vide themselves  with  mortgage  credit  on  better 
terms  and  conditions  than  they  could  ordinarily  pro- 
cure it  from  private  lenders  or  mortgage  companies. 

But  the  proposed  program  for  our  soldiers  is  to 
establish  them  upon  farms.  This  will  require  a  far 
more  flexible  and  more  helpful  financial  method  than 
the  federal  farm  loan  system.  The  task  before  our 
state  legislatures  and  federal  government  is  to  pro- 
vide lands,  farms  and  homes  for  discharged  soldiers 
in  all  parts  of  the  country  on  terms  to  meet  their 
financial  condition.  They  will  require  special  en- 
couragement during  the  first  few  years  of  their  new 
life,  and  this  encouragement  and  aid  the  federal 
farm  loan  system  is  not  designed  or  prepared  to 
give. 


Sources  of  Credit  for  Agriculture        297 

The  elements  of  a  practical  farm  mortgage  credit 
system  for  soldiers,  therefore,  would  seem  to  be: 

(1)  The  requirement  of  a  small  initial  payment 
to  secure  ownership. 

(2)  Loans  to  run  for  a  maximum  period  of  75 
years. 

(3)  Loans  to  be  made  free  of  interest  or  at  a 
rate  not  exceeding  2  per  cent. 

(4)  No  payment  on  the  principal  during  the  first 
5  years. 

(5)  The  amortization  plan  of  paying  off  mort- 
gages with  special  privileges  in  periods  of  distress. 

2.  Short-time  or  personal  credit.  The  matter  of 
providing  short-time  credit  to  soldiers  entering  upon 
farm  life  is  the  more  difficult  problem  to  solve.  At 
the  same  time  it  is  highly  necessary  to  provide  this 
form  of  credit  because  it  will  furnish  the  soldier 
settlers  with  means  for  carrying  on  their  farms 
while  they  are  struggling  to  place  their  holdings  on 
an  economic  basis. 

The  difficulties  of  the  problem  are  indicated  by 
the  fact  that,  though  the  United  States  Commission 
for  the  Study  of  Eural  Credits  and  Agricultural  Co- 
operation in  Europe,  in  its  report  to  Congress  in 
1913,  urged  the  advisability  of  immediate  legisla- 
tion to  provide  short-time  credit  for  farmers,  no 
such  legislation  has  yet  been  seriously  considered 
and  it  is  now  nearly  as  remote  from  realization  as 


298     The  Place  of  Agriculture  in  Reconstruction 

it  has  ever  been.  But  the  subject  should  no  longer 
be  postponed  in  view  of  our  duty  to  our  soldiers  and 
the  growing  demand  for  the  products  of  agricul- 
ture. 

The  personal  credit  problem  is  not  insoluble.  The 
difficulties  have  been  met  and  largely  overcome  in 
many  parts  of  Europe,  and  rural  credit  unions  for 
furnishing  short-time  credit  to  farmers  have  been  es- 
tablished and  operated  successfully  in  Canada  and  in 
parts  of  our  own  country  by  means  of  cooperative 
organizations  and  state  aid. 

The  matter  of  furnishing  short-time  credit  to  sol- 
diers is  imperative.  Their  duty  done  on  the  battle 
field,  it  is  the  duty  of  the  government  to  see  that  their 
energies  shall  not  be  wasted  in  their  attempts  to 
make  their  farms  profitable.  To  do  this  successfully, 
they  must  be  supplied  with  the  active  capital  of  pro- 
duction. This  consists  of  equipment  and  necessary 
farm  supplies.  The  capitalization  of  this  feature 
is  the  main  problem  because  of  the  risk  involved  in 
crop  failure,  loss  of  work  animals,  and  other  mis- 
fortunes which  render  the  agricultural  industry  so 
precarious. 

Short-time  credit  can  and  should  be  provided  by 
government  aid.  No  other  agency  is  adequate  for 
this  emergency,  and  there  can  be  no  better  way  of 
showing  our  appreciation  of  the  risks  taken  by  our 
soldiers  in  defending  our  rights  and  preserving  our 
liberty  than  by  the  government  shouldering  the  little 


Sources  of  Credit  for  Agriculture        299 

risk  taken  in  furnishing  short-time  credit.  A  risk 
will  always  be  there  because  of  the  greater  danger 
of  loss  of  crops  and  live  stock,  the  depreciation  in 
the  value  of  chattels,  and  the  lack  of  security  in  per- 
sonal notes  than  there  is  in  the  case  of  mortgage  se- 
curity, which  is  based  on  the  more  permanent  value 
of  the  land. 

A  special  fund  should  be  established  for  supplying 
personal  credit  to  ex-service  men  who  may  take  up 
farms.  As  in  the  case  with  mortgage  credit,  a  cer- 
tain percentage  of  the  money  required  for  providing 
active  capital  should  be  deposited  by  the  settler.  To 
lower  the  risk,  a  plan  of  insurance  against  loss  should 
be  formulated.  This  has  been  successfully  done 
among  cooperative  societies  in  many  European  coun- 
tries. 

The  security  for  the  balance  advanced  by  the  gov- 
ernment may  take  the  form  of  chattel  mortgages, 
agricultural  warrants,  warehouse  receipts  for  crops, 
any  other  well-recognized  security  except  land,  and 
even  personal  notes  with  two  indorsers. 

A  study  of  the  French  system  of  supplying  short- 
time  credit  through  government  aid  gives  us  valuable 
suggestions.  The  French  government  has  done  more 
for  its  farmers  along  this  line  than  any  other  coun- 
try. The  rate  of  interest  is  low.  The  privilege  of 
renewal  is  granted,  and  considerable  elasticity  is 
given  to  the  French  plan  of  granting  short-time 
credit. 


300     The  Place  of  'Agriculture  in  Reconstruction 

The  plan  is  not  only  feasible,  but  it  can  be  made 
self-supporting.  In  fact  this  is  true  of  the  whole 
credit  aspect  of  land  settlement  by  soldiers.  Apart 
from  the  initial  cost  of  establishing  the  system, 
which  cost  need  not  be  large,  personal  and  mortgage 
credit  for  soldiers  can  be  operated  without  costing 
the  government  a  dollar,  but  which  would  be  of 
inestimable  direct  benefit  to  the  borrowers  and  of 
immense  value  in  promoting  our  national  welfare. 

The  plan  is  applicable  to  individual  cases  and 
colonization  schemes.  In  the  latter  case  special  at- 
tention should  be  given  to  promoting  cooperative 
personal  credit  societies  among  soldiers  settling  on 
agricultural  land,  abandoned  farms,  or  on  reclama- 
tion projects  if  any  such  colonies  should  be  organ- 
ized. As  such  they  will  offer  great  opportunities 
for  developing  the  cooperative  spirit  among  soldier 
farmers  in  the  United  States,  for  experience  has 
shown  that  the  combined  credit  of  50  or  100  farmers 
in  a  cooperative  organization  is  much  more  secure 
than  the  total  credit  of  a  similar  number  of  farmers 
when  working  their  farms  separately.  At  present, 
however,  there  is  less  inclination  to  foster  coloniza- 
tion schemes  for  returning  soldiers  than  there  is  to 
encourage  them  to  learn  the  principles  of  farming 
with  the  object  of  working  as  efficient  farm  hands 
and  ultimately  rising  to  the  status  of  tenant  farmers 
or  farm  owners.  The  colonization  plan  is  better 
adapted  to  our  foreign-born  citizens  who  have  been 


Sources  of  Credit  for  Agriculture        301 

accustomed  to  this  form  of  rural  life  in  European 
countries;  whereas  settlement  on  individual  farms 
is  more  suitable  to  the  American  type  of  agriculture 
with  its  large-size  farms,  independent  life,  and  power 
of  initiative  among  the  farmers  themselves. 

Providmg  the  Necessary  Credit 

Since  any  plan  of  land  settlement  under  American 
standards  of  life  and  practise  should  avoid  as  much 
as  possible  the  element  of  paternalism,  the  rural 
credits  system  for  soldiers  should  at  least  be  self- 
sustaining  if  not  profitable.  Primarily  the  plan  out- 
lined deals  with  land  as  a  fundamental  security 
which  should  become  more  valuable  from  year  to 
year  with  growth  in  population,  its  improvement  into 
equipped  farms,  and  the  gradual  repayment  of  the 
indebtedness  thereon  by  the  farmers.  The  govern- 
ment credit  need  only  be  temporarily  provided,  and 
the  cost  of  supervision  should  be  derived  from  the 
operation  of  the  system  itself. 

In  view  of  the  great  problems  which  confront  us 
as  a  nation — problems  of  indebtedness,  the  recon- 
struction of  agriculture,  unemployment,  and  indus- 
trial development — the  object  of  a  credit  system 
should  be  to  limit  the  strain  on  the  public  purse  in 
order  to  reduce  taxation  as  much  as  possible.  For 
the  great  question  after  all  is,  How  can  the  neces- 
sary credit  be  provided  I  And  the  answer  is  by  taxa- 
tion and  not  by  indebtedness. 


302     The  Place  of  'Agriculture  in  Reconstruction 

While  it  is  true,  as  it  is  frequently  said,  that  the 
war  is  over,  the  effects  of  the  war  will  be  with  us 
for  generations  to  come.  And  it  is  the  effects  of  the 
war  which  call  for  plans  to  be  made  in  the  recon- 
struction of  agricultural  credit.  There  will  be  hun- 
dreds of  those  who,  having  lost  a  limb  in  the  strug- 
gle for  human  liberty,  will  be  badly  handicapped  in 
the  competition  for  employment  and  in  the  struggle 
for  subsistence.  On  the  basis  of  simple  justice  some- 
thing must  be  done  for  these  men  as  partial  compen- 
sation for  the  artificial  handicap  under  which  they 
must  labor  as  victims  of  the  war. 

Our  country,  too,  will  be  heavily  burdened  with 
debt,  the  annual  interest  alone  on  which  will,  at  the 
rate  it  is  accumulating,  be  not  far  short  of  a  billion 
dollars  a  year.  To  this  enormous  sum  must  be  added 
the  increased  cost  of  running  the  government  as  a 
direct  effect  of  the  war  with  the  likelihood  that  it 
will  be  many  years  before  the  income  will  be  suffi- 
cient to  meet  the  ordinary  operating  expenses  and 
pay  interest  on  the  debt  without  adding  annually  to 
the  country's  indebtedness. 

In  the  face  of  these  facts  and  prospects  there  are 
only  two  ways  of  providing  the  necessary  credit  for 
agricultural  development,  namely,  by  taxation  and 
by  a  more  economical  governmental  administration. 
It  would  be  useless  to  undertake  to  raise  funds  to 
provide  rural  credits  for  soldiers  by  means  of  the 
issue  of  bonds  if  it  were  expected  to  avoid  running 


Sources  of  Credit  for  Agriculture       303 

the  country  into  greater  indebtedness  or  to  make 
loans  to  soldiers  at  a  low  rate  of  interest.  During 
the  war  period  the  government  was  able  to  borrow 
money  of  the  public  by  the  issue  of  bonds  at  rates 
of  interest  ranging  from  3%  to  4%  per  cent.  If 
money  were  procured  in  this  way  to  lend  to  soldier 
settlers,  the  rate  of  interest  on  loans  to  them  would 
have  to  equal  the  rate  at  which  the  money  was  bor- 
rowed or  the  country  would  sink  still  deeper  into 
debt.  It  is  to  avoid  this  difficulty  that  it  is  proposed 
to  raise  the  credit  fund  for  soldier  farmers  by  taxa- 
tion and  by  greater  economy  in  running  the  govern- 
ment. 

Notwithstanding  the  advent  of  peace  the  Ameri- 
can people  face  a  long  series  of  years  under  heavy 
taxation  even  if  there  were  no  call  upon  us  to  aid 
soldiers  in  settling  on  the  land.  With  a  six  billion 
dollar  tax  bill  to  meet  for  the  years  1919  and  1920 
there  is  no  escape  except  by  going  down  into  our 
pockets  and  paying  this  tax  levy  each  year.  By  that 
time  the  situation  might  clarify  so  that  it  may  not 
be  so  difficult  to  see  the  way  to  a  better  system  of 
rural  credits  for  soldiers.  Our  enormous  debt  and 
expensive  administration  make  heavy  taxation  in- 
evitable. It  is  a  fact  the  American  people  might 
as  well  meet  with  a  smiling  face.  If  a  little  heavier 
taxation  should  be  made  necessary  because  of  our 
plain  duty  to  those  who  offered  their  lives  in  de- 
fense of  our  country's  honor,  the  ninety-five  millions 


304     The  Place  of  'Agriculture  in  Reconstruction 

of  the  population  who  remained  at  home  enjoying  the 
comforts  and  blessings  of  domestic  and  social  life 
ought  to  meet  that  condition  with  a  smile,  too.  If  we 
have  to  go  a  little  deeper  into  our  pockets  in  order 
to  train  our  maimed  heroes  to  become  useful  units 
in  the  field  of  economic  production  or  to  enable  them 
to  take  up  and  equip  a  farm  for  a  living,  it  is  at  best 
a  poor  reward  for  all  that  these  men  have  suffered 
and  must  continue  to  suffer  in  being  thus  handi- 
capped for  the  remainder  of  their  life.  When  we 
face  the  facts  squarely ^  our  people  should  glory  in 
just  taxation  for  such  an  end.  But  whether  we 
glory  in  it  or  not,  there  will  be  no  escape  from  heavy 
taxation  for  many  years  to  come. 

It  is  doubtful,  however,  if  an  increase  of  taxation 
would  be  necessary  to  provide  the  funds  for  supply- 
ing credit  to  soldiers  taking  up  agricultural  land  if 
our  government  could  possibly  be  run  on  a  business 
instead  of  on  a  political  basis.  Several  years  ago  a 
senator  from  Ehode  Island  made  the  statement  that 
if  our  government  were  organized  and  conducted  as 
the  affairs  of  a  business  house  are  conducted,  it 
would  result  in  the  saving  of  about  $300,000,000  a 
year.  At  the  present  time  those  figures  could  doubt- 
less be  increased  considerably.  The  waste  of  ma- 
terial and  the  employment  of  numbers  of  people  who 
serve  no  useful  purpose  have  kept  pace  with  the 
changes  of  administration  during  the  past  40  years. 
There  is  no  throwing  of  stones  any  more.  Both 


Sources  of  Credit  for  Agriculture        305 

parties  live  in  glass  houses  and  one  party  is  as  deep 
in  the  mud  as  the  other  is  in  the  mire.  There  is  a 
statute  that  no  two  from  the  same  family  shall  be 
employed  in  the  government  civil  service,  but  hun- 
dreds would  be  seeking  employment  in  the  business 
world  if  this  statute  were  enforced  and  hundreds  of 
places  would  be  left  vacant  for  our  disabled  and  dis- 
charged soldiers  and  sailors  to  fill  if  the  occupancy 
of  those  positions  were  necessary  at  all. 

The  unfortunate  feature  of  this  situation  is  that 
there  is  little  likelihood  of  any  immediate  reform. 
There  seems  to  be  no  way  of  letting  go.  If  any  pro- 
posal is  made  in  Congress  to  classify  and  pay  the 
civilian  employees  of  the  government  on  a  uniform 
basis,  it  never  gets  any  farther  than  the  committee 
room.  If  any  effort  is  made  to  bring  about  a  more 
business-like  administration  of  the  executive  de- 
partments of  the  government,  it  seldom  gets  any 
farther  than  the  initial  stages  because  so  many  per- 
sons would  be  found  who  were  doing  little  or  no 
work,  or  were  drawing  salaries  out  of  all  proportion 
to  valuable  services  rendered,  that  it  might  prove 
embarrassing  to  present  members  of  Congress  to 
have  light  thrown  on  the  real  situation.  The  sys- 
tem has  grown  up  from  one  congressional  session  to 
another  as  a  result  of  political  patronage  and  the 
over-population  of  cities,  so  that  it  is  now  practically 
and  to  a  considerable  extent  nothing  more  nor  less 
than  incipient  paternalism.  Places  have  been  found 


306    The  Place  of  'Agriculture  in  Reconstruction 

after  every  election  for  the  faithful  political  worker 
until  the  government  service  has  become  a  by-word 
and  a  reproach  to  those  who  know  it  from  inside  ex- 
perience. The  corresponding  effects  of  this  form 
of  paternalism  have  been  a  gradual  depopulation  of 
rural  districts,  an  increase  in  taxation,  and  a  de- 
crease in  the  standard  of  living. 

A  reform  at  the  present  time  would  be  almost 
disastrous.  While  the  demands  for  retrenchment  are 
imperative,  the  system  of  government  paternalism 
has  become  so  cumbersome  that,  if  many  hundreds 
of  employees  were  soon  added  to  the  stream  of  sol- 
diers weekly  demobilized,  the  danger  of  unemploy- 
ment would  be  greatly  increased.  For  what  could 
these  persons  do  for  a  living?  Many  of  them  do  not 
have  the  inclination  to  perform  physical  labor,  nor 
have  they  been  trained  to  cultivate  the  soil;  to  beg 
they  would  be  ashamed.  So  they  must  be  carried  on 
the  payrolls  of  the  government,  since  Congress  and 
the  public  are  powerless  at  this  time  to  check  sud- 
denly the  system  which  has  been  growing  up  for 
nearly  half  a  century.  The  government  disburse- 
ments in  1878  were  $4.98  per  capita;  on  July  1, 1918, 
they  were  $84.69  per  capita.  The  annual  interest 
charge  at  that  time  was  $466,256,884,  which  had  prac- 
tically doubled  by  the  end  of  1918.  Thus  the  govern- 
ment expenditures  have  increased  to  about  $170  per 
capita  a  year.  This  is  a  condition  which  faces  the 
American  people.  We  may,  therefore,  look  forward 


Sources  of  Credit  for  Agriculture       307 

with  cheerfulness  to  a  long  period  of  heavy  taxation 
whether  or  not  any  saving  is  accomplished  in  behalf 
of  soldier  settlers  or  whether  taxation  is  increased 
to  supply  them  with  needed  credit  on  farms.1 

When  it  comes  to  a  consideration  of  direct  ex- 
penditures in  behalf  of  agriculture,  the  outlook  is  not 
more  promising.  Of  the  annual  appropriations  made 
for  the  United  States  Department  of  Agriculture, 
an  official  publication  stated  a  few  years  ago  that 
"administrative  and  regulatory  functions  of  the  de- 
partment now  absorb  nearly  two-thirds  of  the  total 
appropriation."  That  is  to  say,  on  the  basis  of  an 
annual  appropriation  of  $27,000,000  it  costs  the  gov- 
ernment $18,000,000  to  see  that  $9,000,000  are  ex- 
pended in  behalf  of  agriculture.  And  even  then  it 
would  take  a  very  vivid  stretch  of  the  imagination 
to  include  the  work  of  some  bureaus  of  that  depart- 
ment as  "practical  agriculture "  for  which  the 
$9,000,000  are  expended. 

While  these  tendencies  of  governmental  activities 

1  Since  the  above  was  written,  efforts  have  been  made  to  bring 
about  just  such  reforms  as  are  indicated.  Thus  the  act  making  ap- 
propriations for  the  legislative,  executive  and  judicial  expenses  of  the 
government  for  the  year  ending  June  30,  1920,  provides  for  a  joint 
commission  consisting  of  three  senators  and  three  congressmen  for 
the  purpose  of  reclassifying  the  rates  of  compensation  paid  to  civil- 
ian employees  by  the  municipal,  executive  and  other  government 
establishments  in  the  District  of  Columbia,  except  the  navy  yard  and 
the  postal  service,  "to  provide  uniform  and  equitable  pay  for  the 
same  character  of  employment  throughout  the  District  of  Columbia 
in  the  services  enumerated/' 

The  same  act  also  authorizes  the  Congressional  Joint  Committee 
on  Printing  to  adopt  such  measures  as  may  be  deemed  necessary  to 
remedy  any  waste  in  the  public  printing  and  binding,  such  as  the 
stopping  of  the  printing  of  useless  publications, 


308     The  Place  of  Agriculture  in  Reconstruction 

are  clearly  paternalistic  and  must  be  met  by  taxa- 
tion, the  industry  of  agriculture  as  such  bears  its 
share  of  the  national  burden.  Governmental  ex- 
penditures are  used  in  wealth  consumption.  But  if 
any  portion  of  them  were  saved  by  running  the  gov- 
ernment on  a  business  basis  and  the  amount  thus 
saved  were  used  for  agricultural  credit  in  behalf  of 
soldier  settlers  or  established  farmers,  it  would  be 
invested  as  productive  wealth  and  would  encourage 
the  development  of  agriculture.  But  since  food 
products  are  essential  to  the  well-being  of  the  whole 
population,  the  advancement  of  public  funds  for 
farming  purposes  at  a  low  rate  of  interest,  or  even 
free  of  interest,  would  be  for  the  public  good  rather 
than  for  the  benefit  of  the  farming  class  of  the  popu- 
lation. While  farmers  are  the  agents  of  wealth 
production  from  the  soil,  the  food  products  raised 
are  necessary  for  the  maintenance  of  the  people  in 
health  and  in  life.  For  these  reasons  the  promotion 
of  rural  credits  is  primarily  and  fundamentally  the 
promotion  of  national  welfare.  If  sufficient  funds 
cannot  be  saved  by  a  more  economical  administration 
of  the  government,  the  balance  must  be  obtained  by 
taxation — a  condition  which  the  people  must  face 
and  which  will  be  cheerfully  met  if  they  realize  how 
much  their  happiness  and  welfare  depend  thereon. 
It  may  be  said  that,  if  a  law  were  passed  to  pro- 
vide credit  at  a  low  rate  of  interest  in  behalf  of 
soldiers  taking  up  farming,  it  would  be  class  legisla- 


Sources  of  Credit  for  Agriculture        309 

tion,  since  it  is  claimed  that  the  government  should 
not  legislate  for  the  rural  population  as  against  the 
people  who  dwell  in  towns  and  cities ;  that  it  should 
not  aid  men  taking  up  agriculture  any  more  than  it 
should  aid  those  entering  any  other  line  of  work. 
In  a  strict  sense  of  the  term  that  would  be  true.  But 
this  argument  overlooks  the  fact  that  agriculture  is 
the  only  universal  industry  the  products  of  which 
must  enter  daily  into  every  home  in  the  land  or  great 
suffering  will  result.  The  recognition  of  this  fact  led 
France  many  years  ago  to  give  liberal  support  to 
agriculture  by  supplying  credit  at  a  low  rate  of  in- 
terest, with  the  result  that  when  the  European  war 
broke  out  she  was  able  to  support  herself  almost  en- 
tirely from  the  products  of  her  own  fields,  orchards 
and  gardens.  It  was  the  wise  system  of  rural  credits 
which  checked  rural  depopulation,  brought  about  the 
rehabilitation  of  agriculture,  and  produced  a  con- 
dition of  national  prosperity  at  the  outbreak  of  the 
war  which  had  not  been  surpassed  in  the  previous 
history  of  France. 

If  land  settlement  for  soldiers  and  civilians  is  to 
succeed  in  the  United  States,  then  the  lesson  of  the 
past  for  a  country  with  abundance  of  land  and  labor 
is  that  the  most  essential  factor  may  be  regarded 
as  sufficient  capital  provided  by  the  government  on 
easy  terms  and  conditions.  The  need  for  it  may  be 
clearly  realized  by  a  study  of  the  following  chapter 
on  farm  mortgage  credit  in  our  own  country. 


CHAPTEE  XII— THE  PROBLEM  OF  EUEAL 
CEEDITS  IN  THE  UNITED  STATES 

As  previously  shown,  the  drains  on  a  farmer's  re- 
sources are  many  as  soon  as  he  becomes  a  landowner. 
He  not  only  has  to  run  the  risk  of  crop  and  livestock 
losses  as  a  result  of  the  precariousness  of  the  indus- 
try, but  he  has  to  pay  insurance,  keep  up  the  prop- 
erty, pay  taxes  and  interest  on  indebtedness,  and 
make  other  outlays.  If  a  farmer  happens  to  have 
a  mortgage  on  his  farm,  he  lives  in  dread  of  fore- 
closure as  the  end  of  the  mortgage  period  ap- 
proaches, unless  he  is  prepared  to  pay  off  his  mort- 
gage, which  is  rarely  the  case  under  existing  condi- 
tions of  farming.  But  even  if  a  farm  mortgage  can 
be  renewed,  it  is  usually  by  the  paying  of  a  commis- 
sion which  adds  to  the  burden  of  interest.  Commis- 
sion charges  and  interest  rates  have  varied  in  dif- 
ferent states,  but  they  are  always  high  enough  to 
make  the  payment  of  them  by  a  struggling  farmer 
a  real  hardship. 

With  the  value  of  farm  property  placed  at  about 
$41,000,000,000  by  the  thirteenth  census  of  1910,  it  is 
evident  that  agriculture  pays  its  just  share  of  taxa- 
tion toward  the  operating  expenses  of  the  govern- 

310 


The  Problem  of  Rural  Credits          811 

ment.  With  such  a  large  problem  as  that  of  prepar- 
ing soldiers  as  farmers  and  establishing  them  on  the 
land,  the  preceding  chapter  has  shown  that  the  fur- 
nishing of  capital  on  easy  terms  and  conditions  is 
practically  essential  to  their  success.  Moreover, 
from  past  experience  of  other  nations  as  well  as  of 
our  own,  it  has  been  learned  that  heavy  taxation  and 
high  interest  rates  have  had  great  influence  in  de- 
populating rural  districts ;  and,  conversely,  by  light- 
ening these  conditions  so  as  to  make  farming  more 
pleasant  and  profitable,  the  result  has  been  not  only 
to  retain  the  rural  population  on  the  land,  but  to 
increase  their  happiness  and  improve  the  economic 
and  social  welfare  of  rural  communities. 

Efforts  to  Improve  Rural  Life  Conditions 

In  the  United  States  in  the  past,  one  of  the  great- 
est drawbacks  to  the  progress  of  agriculture  has  been 
the  lack  of  capital.  This  was  partly  due  to  the  re- 
moteness of  farms  from  the  great  financial  centers, 
which  made  it  hard  to  get  credit  at  any  price,  and 
partly  to  the  greater  demands  for  capital  in  indus- 
tries and  the  much  shorter  time  for  which  such  loans 
were  made. 

The  competition  for  capital  which  thus  arose  re- 
sulted in  agriculture  having  to  pay  a  high  rate  of 
interest,  but  mortgage  loans  when  contracted  were 
made  for  longer  periods  of  time.  The  cost  of  deter- 
mining the  appraisal  value  of  a  farm  offered  as  se- 


312     The  Place  of  Agriculture  in  Reconstruction 

curity  for  a  loan  was  greater  in  the  country  than  in 
towns  and  cities  where  the  value  of  ten  properties 
could  be  ascertained  in  the  time  it  would  take  to  ap- 
praise a  single  farm.  The  conditions  surrounding 
farm  loans  were  such  that  the  creditor  had  to  charge 
commissions  in  order  to  pay  local  agents  for  doing 
the  work  of  procuring  and  contracting  loans.  Conse- 
quently, interest  rates  and  commission  charges  on 
farm  mortgage  loans  varied  in  different  parts  of  the 
United  States  but  were  generally  much  higher  than 
in  other  industries.  While  these  facts  have  been  well 
known,  the  effects  upon  agriculture  have  not  been 
generally  recognized. 

The  primary  effect  of  an  increased  return  to 
capital  invested  in  farming  is  to  decrease  the  re- 
ward to  labor.  If  a  farmer  operated  his  own  farm 
on  which  he  carried  a  mortgage  and  had  other  in- 
debtedness, his  net  income  would  be  smaller  the 
greater  the  amount  he  had  to  pay  out  as  interest  and 
commission.  If  he  employed  labor,  the  wages  he 
could  pay  would  necessarily  be  lower.  The  direct 
economic  effect  of  a  high  interest  rate  on  farm  mort- 
gage loans  is  to  decrease  the  income  of  farm  work- 
ers whether  they  are  farm  laborers,  tenant  farmers, 
or  farm  owners.  The  indirect  effect  would  be  to  de- 
crease the  supply  of  farm  workers,  because  the  con- 
dition of  day-wage  and  salaried  positions  in  towns 
and  cities,  with  more  regular  hours  of  work  and 
higher  pay,  would  attract  them  from  farm  work  to 


The  Problem  of  Rural  Credits          313 

industrial  and  social  service  activities.  Thus  many 
of  the  best  farmers  and  most  intelligent  young  men 
and  women  were  driven  from  farm  life  because  of 
unfavorable  mortgage  credit  conditions. 

Eecognizing  these  facts  but  not  the  conditions 
which  brought  them  into  existence,  legislation  at  first 
sought  to  improve  rural  life  conditions  by  appoint- 
ing commissions  to  investigate  the  causes  of  rural 
depopulation.  The  United  States  Department  of 
Agriculture  was  thus  created  not  only  to  promote 
practical  agriculture,  but  to  encourage  increased 
production  on  the  same  acreage  and  to  improve  the 
economic,  social  and  sanitary  conditions  of  rural 
communities.  But  no  consideration  whatever  was 
given  to  the  financial  side  of  the  problem  of  rural 
life.  The  result  was  that,  with  a  more  rapid  develop- 
ment of  industry  and  commerce,  the  demand  for 
labor  in  towns  and  cities  increased  more  rapidly  than 
the  normal  growth  in  agriculture  warranted,  so  that 
the  labor  forces  of  country  and  city  became  still  more 
unbalanced  and  attracted  once  more  the  attention, 
of  Congress  to  the  relation  of  agriculture  to  national1 
welfare.  It  was  then  sought  to  improve  the  condi- 
tions of  farm  life  by  establishing  agricultural  edu- 
cational institutions,  such  as  the  state  colleges  of 
agriculture  and  mechanic  arts,  fostered  by  state  and 
federal  aid,  with  a  supervisory  organization  over  the 
whole  set  up  in  the  United  States  Department  of 
Agriculture. 


314    The  Place  of  Agriculture  in  Reconstruction 

The  economic  effects  of  these  various  movements 
covering  not  less  than  a  quarter  of  a  century  were 
not  only  to  make  progress  in  crop  production,  farm 
management,  and  soil  conservation,  but  to  with- 
draw a  large  body  of  the  younger  generation  of 
promising  and  progressive  farmers  away  from  the 
fields  to  take  up  desk  work  in  these  various  institu- 
tions. But  the  calling  of  these  men  from  the  farms 
led  to  a  decrease  in  the  number  of  efficient  farm 
workers,  increased  state  and  federal  government  ex- 
penditures and  paternalistic  tendencies,  and  added 
to  the  burden  of  the  farmer  by  increased  taxation. 
It  was  this  general  tendency  which  created  the  con- 
dition that  it  cost  two  dollars  to  supervise  the  ex- 
penditure of  one  dollar  in  behalf  of  agriculture.  In 
other  words,  for  every  dollar  put  into  one  pocket  of 
the  farmer  two  dollars  were  taken  out  of  the  pocket 
of  the  general  public  by  means  of  taxation  to  bring 
about  this  result. 

It  was  expected  that  the  establishment  of  agri- 
cultural colleges  and  experiment  stations  would  re- 
sult in  a  repopulation  of  the  rural  districts  by  train- 
ing young  men  to  practise  scientific  agriculture  and 
by  creating  more  enjoyable  domestic  life  relations 
for  the  young  women.  The  results,  however,  were  the 
reverse  from  those  anticipated.  The  great  majority 
of  these  young  people  never  returned  to  active  farm 
life.  They  remained  either  as  teachers  in  the  institu- 
tions which  gave  them  their  education,  or  entered 


The  Problem  of  Rural  Credits          315 

the  service  of  state  departments  of  agriculture  or 
the  federal  department  of  agriculture,  or  engaged 
in  some  business  which  offered  better  financial  re- 
turns than  farming. 

When  the  expedient  of  carrying  farmers  to  school 
had  failed  to  keep  up  the  required  supply  of  farm 
workers,  the  experiment  was  tried  of  carrying  edu- 
cation of  a  practical  nature  to  farmers  by  means  of 
county  agents  and  to  their  wives  by  means  of  do- 
mestic service  demonstrators.  The  most  active  and 
progressive  farmer  in  each  county  was  selected  to 
visit  the  farms  of  his  own  county  and  make  known  to 
farmers  the  best  methods  of  handling  soils,  growing 
crops,  inoculating  live  stock  against  diseases,  and 
spraying  to  control  plant  diseases.  County  agents 
thus  became  traveling  farm  instructors. 

The  extent  of  the  growth  of  this  work  is  indicated 
in  the  report  of  the  Secretary  of  Agriculture  for 
1918.  The  United  States  Department  of  Agriculture, 
in  cooperation  with  the  state  colleges  of  agriculture, 
undertook  to  place  in  each  rural  county  one  or  more 
agents.  ' '  When  this  nation  entered  the  war  in  April, 
1917,  there  was  a  total  of  2,149  men  and  women  em- 
ployed in  county,  home  demonstration,  and  boys' 
and  girls'  club  work,"  says  the  report,  but  in  Novem- 
ber, 1918,  "the  number  had  increased  to  5,218,  of 
which  1,513  belong  to  the  regular  staff  and  3.705  to 
the  emergency  force.  There  were  2,732  in  the  county 
agent  service,  1,724  in  the  home  demonstration  work, 


316     The  Place  of  'Agriculture  in  Reconstruction 

and  762  in  the  boys'  and  girls'  club  activities.  This 
does  not  include  the  large  number  of  specialists  as- 
signed by  the  department  and  the  colleges  to  aid  the 
extension  workers  in  the  field  and  to  supplement 
their  efforts." 

The  plain  outcome  of  the  extension  service  move- 
ment has  been  to  remove  more  men  from  the  fields 
of  productive  agriculture.  The  labor  forces  on  the 
farms,  were  thereby  depleted ;  and,  while  this  move- 
ment tended  to  increase  agricultural  production,  the 
appointment  of  large  numbers  of  men  and  women 
at  good  salaries  increased  taxation  proportionately. 
In  this  case,  the  increased  financial  burden  fell 
largely  on  the  farming  population. 

Looking  at  the  entire  rural  life  movement  in  the 
United  States  for  the  half  century  preceding  the 
year  1910,  when  agitation  began  in  behalf  of  rural 
credits,  it  can  only  be  regarded  as  a  failure  so  far 
as  furnishing  a  supply  of  farm  workers  and  making 
farming  more  profitable  are  concerned.  A  few  far- 
seeing  men  had  in  the  meantime  been  proclaiming 
that  the  real  difficulty  was  debt  and  taxation,  both 
of  which  had  been  exacting  an  ever-increasing  toll 
from  the  farmer  and  thereby  constantly  decreasing 
the  returns  for  his  labor  and  capital.  It  was  the 
realization  of  this  condition  which  finally  led  to  the 
establishment  of  the  federal  farm  loan  system  in 
1916.  But  even  this  plan  of  supplying  credit  to 
farmers  is  limited  to  farm  mortgages,  and  no  legis- 


The  Problem  of  Enrol  Credits          317 

lation  lias  been  enacted  for  the  purpose  of  granting 
short-time  or  personal  loans  to  farmers.  After 
nearly  ten  years  of  agitation  and  attempted  legisla- 
tion in  behalf  of  short-time  rural  credit,  the  United 
States  is  not  much  nearer  the  goal  than  it  was  before, 
notwithstanding  the  great  importance  of  this  phase 
of  farm  finance  and  its  relation  to  the  improvement 
of  rural  life  conditions.  In  his  report  for  1918,  the 
Secretary  of  Agriculture  says  that  "it  still  seems 
clear  that  there  should  be  provided  a  system  of  per- 
sonal-credit unions,  especially  for  the  benefit  of  in- 
dividuals whose  financial  circumstances  and  scale 
of  operations  make  it  difficult  for  them  to  secure  ac- 
commodations through  the  ordinary  channels.  .  .  , 
What  further  can  be  done  by  the  federal  govern- 
ment directly  to  stimulate  personal-credit  unions  it 
is  difficult  to  outline.  This  matter  has  received  con- 
sideration at  the  hands  of  many  experts  and  was 
thoroughly  canvassed  by  a  joint  committee  of  Con- 
gress. The  conclusion,  up  to  the  present,  seems  to 
be  that  the  field  is  one  primarily  for  the  states  to 
occupy  through  sound  legislation." 

The  Debt  of  Agriculture 

When  one  tries  to  ascertain  the  financial  burden 
under  which  the  agricultural  industry  is  laboring  at 
the  present  time,  he  soon  finds  that  the  actual  in- 
debtedness of  farmers  is  unknown.  The  census  of 
1910  attempted  to  determine  the  mortgage  indebted- 


318    The  Place  of  Agriculture  in  Reconstruction 

ness  on  farms,  but  could  only  report  the  amount  on 
farms  operated  by  their  owners.  The  figures  of 
mortgage  debt  given  are  $1,726,172,851,  but  the  fol- 
lowing explanatory  statements  are  appended : 

"The  census  statistics  with  reference  to  the 
amount  of  mortgage  debt  do  not  cover  all  the  mort- 
gaged farms  reported.  In  some  cases  the  enumerat- 
ors were  able  to  ascertain  that  a  farm  was  mort- 
gaged, but  were  unable  to  secure  a  statement  of  the 
amount  of  indebtedness.  Further,  the  statistics  rela- 
tive to  the  amount  of  indebtedness  do  not  include  the 
farms  operated  by  owners  who  rent  additional  land, 
which  make  up  a  considerable  number.  In  the  case 
of  these  farms  the  report  as  to  the  amount  of  debt 
would  necessarily  relate  only  to  the  land  which  was 
owned  by  the  operator,  and  it  would  be  improper  to 
compare  it  with  the  entire  value  of  the  farm,  in- 
cluding that  of  the  hired  land.  The  total  number 
of  mortgaged  farms  operated  by  owners,  including 
those  who  rent  additional  land,  in  the  United  States 
in  1910  was  1,327,439,  but  the  number  for  which  sta- 
tistics regarding  the  amount  of  indebtedness  have 
been  compiled  is  only  1,006,511." 

It  was  further  shown  that  the  total  value  of  these 
1,006,511  farms  was  $6,330,000,000,  and  the  amount 
of  debt  $1,726,172,851,  or  27.3  per  cent  of  the  value; 
and  that  "the  average  amount  of  mortgage  indebted- 
ness per  farm  increased  from  $1,224  in  1890  to 
$1,715  in  1910." 


The  Problem  of  Rural  Credits          319 

The  United  States  Department  of  Agriculture  also 
made  some  investigations  after  the  census  statis- 
tics were  taken,  and  reported  the  estimated  amount 
of  farm  mortgage  loans  to  be  about  $3,598,985,000. 

All  these  data,  however,  relate  to  the  amount  of 
mortgage  indebtedness  on  the  land  only.  What  the 
approximate  amount  of  personal  indebtedness  of 
American  farmers  is  has  not  been  calculated,  though 
from  time  to  time  estimates  of  various  amounts  are 
stated.  But  the  fact  is  that  the  actual  amount  of 
debt  the  agricultural  industry  supports  is  not 
known.  It  may  be  more  or  less  than  the  27.3  per  cent 
ascertained  by  the  census  on  mortgaged  farms.  If 
this  figure  is  approximately  correct  for  all  farm  in- 
debtedness, it  proves  the  enormous  burden  that  the 
average  farmer  is  carrying  at  the  present  time. 

If  a  soldier  settler  should  take  up  a  farm  and  as- 
sume an  interest-bearing  debt  three  times  as  great 
as  that  carried  by  the  average  farmer,  it  must  be 
evident  that  his  chances  of  success  would  not  be 
promising.  His  hope  of  success  would  rest  in  part 
on  the  rate  of  interest  he  would  have  to  pay.  A 
low  rate  of  interest  would  lighten  his  burden  con- 
siderably. Before  the  establishment  of  the  federal 
farm  loan  system  the  rate  of  interest  charged  on 
loans  was  very  high  in  some  parts  of  the  country, 
and  commission  charges  made  to  borrowers  at  the 
time  of  procuring  a  loan,  as  well  as  at  renewal  pe- 
riods every  three,  four,  or  five  years,  added  conr 


320    The  Place  of  Agriculture  in  Reconstruction 

siderably  to  the  drain  on  a  farmer's  income.  The 
farm  loan  board  found  after  an  extensive  inquiry 
that  rates  of  interest  were  sometimes  as  high  as  10 
and  12  per  cent;  with  commission  charges  added  the 
farmer's  burden  was  sometimes  increased  to  15  per 
cent.  More  definite  figures  ascertained  by  the  United 
States  Department  of  Agriculture  warrant  the  fol- 
lowing summary: 

The  average  rate  of  interest  to  farmers  on  mort- 
gage loans  ranges  from  5.3  per  cent  in  New  Hamp- 
shire to  9.7  per  cent  in  New  Mexico.  The  average 
rate  of  interest  on  farm  mortgage  loans  with  com- 
mission charges  added  ranges  from  5.3  per  cent  in 
New  Hampshire,  where  the  average  commission  is 
less  than  one-tenth  of  1  per  cent,  to  10.5  per  cent  in 
New  Mexico,  where  the  commission  charge  averages 
four-fifths  of  1  per  cent.  The  highest  average  com- 
mission charges  are  in  the  states  of  North  Dakota 
and  Oklahoma,  in  both  of  which  states  they  average 
1.8  per  cent.  The  average  farm  mortgage  rate  of 
interest  throughout  the  United  States  without  com- 
mission charges  is  6.9  per  cent;  with  commission 
charges  it  is  7.4  per  cent. 

Farmers  all  over  the  country  are  striving  to  get 
out  from  under  this  burden  by  replacing  their  in- 
debtedness at  a  cheaper  rate  of  interest.  The  fed- 
eral farm  loan  system  began  by  making  loans  at  5 
per  cent  interest,  but  with  the  progress  of  the  war 
the  rate  was  increased  to  5%  per  cent.  But  even  at 


The  Problem  of  Rural  Credits          321 

this  higher  rate  of  interest,  the  federal  land  banks 
could  not  supply  the  farmers'  demands  for  loans  fast 
enough,  the  greatest  percentage  of  the  loans  being  to 
pay  off  existing  indebtedness.  Thus  of  more  than 
23,000  applications  for  loans  examined  in  the  Federal 
Farm  Loan  Bureau  covering  every  state  in  the 
Union,  60  per  cent  of  the  loans  were  procured  to 
pay  off  existing  mortgage  debts  and  10  per  cent  to 
pay  off  other  debts.  On  the  basis  of  these  data  it  is 
safe  to  conclude  that  about  70  per  cent  of  all  loans 
made  by  the  federal  land  banks  are  to  pay  off  exist- 
ing indebtedness  of  the  borrowers  and  to  refund 
their  indebtedness  at  a  lower  rate  of  interest. 

The  Burd&n,  of  Interest 

Under  ordinary  conditions  of  borrowing  by  farm- 
ers or  soldier  settlers,  debt  is  not  only  a  burden  but 
it  is  absolutely  dangerous.  If  a  farmer  borrows 
money  to  buy  land,  to  purchase  equipment,  fertilizers 
or  live  stock,  to  erect  buildings  or  make  other  im- 
provements— these  various  forms  of  fixed  and  op- 
erating capital  depreciate  in  value  with  age  and  use, 
but  the  money  borrowed  and  invested  to  purchase 
these  things  continues  to  exact  its  annual  or  semi- 
annual toll  without  mercy.  The  interest  period  rolls 
around  with  deadly  certainty,  and  woe  be  to  the  un- 
fortunate farmer  who  cannot  meet  his  interest  if  he 
has  fallen  into  the  hands  of  an  unscrupulous  money 
lender.  It  is  this  power  of  money  to  exact  its  share 


322     The  Place  of  'Agriculture  in  Reconstruction 

from  the  products  of  the  labor  and  capital  of  the 
farmer  without  any  decrease,  while  all  other  forms 
of  farm  wealth  depreciate  in  value,  that  constitutes 
one  of  the  most  flourishing  means  of  depopulating 
rural  districts. 

It  was  to  relieve  this  constant  pressure  by  lower- 
ing the  rate  of  interest  on  loans  and  by  putting  into 
practise  the  amortization  plan  of  repaying  loans 
that  brought  about  the  establishment  of  the  federal 
farm  loan  system.  The  amortization  of  a  loan  sim- 
ply means  that  a  borrower  pays  off  part  of  his  debt 
each  annual  or  semi-annual  interest  period  and  that 
he  pays  interest  only  on  the  balance  of  debt  remain- 
ing unpaid.  This  lightens  a  farmer 's  burden  of  in- 
terest considerably  where  a  loan  runs  for  30  or  35 
years. 

The  advantage  to  the  borrower  in  the  saving  of 
interest  may  be  realized  by  a  study  of  the  amortiza- 
tion table  on  the  opposite  page  in  comparison  with  a 
straight  mortgage  loan  for  the  same  sum,  rate  of 
interest,  and  period  of  loan. 

During  the  35  years  that  this  amortized  loan  is 
being  repaid  the  total  amount  of  money  a  farmer 
would  pay  back  on  a  loan  of  $1,000  would  be  no  less 
than  $2,272.50,  of  which  $1,272.50  is  interest  and 
$1,000  the  principal.  Therefore,  the  toll  exacted  by 
interest  out  of  the  labor  and  capital  of  the  farmer 
during  the  period  of  this  loan  is  no  less  than  127% 
per  cent.  And  yet  this  is  an  easy  method  of  repay- 


The  Problem  of  Rural  Credits          323 


A  loan  of  $1,000  at  5%  per  cent  interest  repayable  in,  35  years  "by 

means  of  annual  instalments  of  $65,  which  include 

interest  and  part  of  the  principal. 


Payment 

Applied  on 

Principal 

Number 

Instalment 

Interest 

principal 

still  unpaid 

1. 

$65.00 

$55.00 

$10.00 

$990.00 

2. 

65.00 

54.45 

10.55 

979.45 

3. 

65.00 

53.87 

11.13 

968.32 

4. 

65.00 

53.26 

11.74 

956.58 

5. 

65.00 

52.61 

12.39 

944.19 

6. 

65.00 

51.93 

13.07 

931.12 

7. 

65.00 

51.21 

13.79 

917.33 

8. 

65.00 

50.45 

14.55 

902.78 

9. 

65.00 

49.65 

15.35 

887.43 

10. 

65.00 

48.81 

16.19 

871.24 

11. 

65.00 

47.92 

17.08 

854.16 

12. 

65.00 

46.98 

18.02 

836.14 

13. 

65.00 

45.99 

19.01 

817.13 

14. 

65.00 

44.94 

20.06 

797.07 

15. 

65.00 

43.84 

21.16 

775.91 

16. 

65.00 

42.68 

22.32 

753.59 

17. 

65.00 

41.45 

23.55 

730.04 

18. 

65.00 

40.15 

24.85 

705.19 

19. 

65.00 

38.79 

26.21 

678.98 

20. 

65.00 

37.34 

27.66 

651.32 

21. 

65.00 

35.82 

29.18 

622.14 

22. 

65.00 

34.22 

30.78 

591.36 

23. 

65.00 

32.52 

32.48 

558.88 

24. 

65.00 

30.74 

34.26 

524.62 

25. 

65.00 

28.85 

36.15 

488.47 

26. 

65.00 

26.87 

38.13 

450.34 

27. 

65.00 

24.77 

40.23 

410.11 

28. 

65.00 

22.56 

42.44 

367.67 

29. 

65.00 

20.22 

44.78 

322.89 

30. 

65.00 

17.76 

47.24 

275.65 

31. 

65.00 

15.16 

49.84 

225.81 

32. 

65.00 

12.42 

52.58 

173.23 

33. 

65.00 

9.53 

55.47 

117.76 

34. 

65.00 

6.48 

58.52 

59.24 

35. 

62.50 

3.26 

59.24 



$2,272.50         $1,272.50         $1,000.00 

ing  a  loan  as  compared  with  an  ordinary  straight 
mortgage  loan  as  the  following  illustration  will  make 
clear : 


324     The  Place  of  Agriculture  in  Reconstruction 

Suppose  a  farmer  procures  a  loan  of  $1,000  from 
a  farm  mortgage  company  at  5l/z  per  cent  annual 
interest  and  has  nothing  extra  to  pay  in  the  form 
of  commission  or  renewal  charges.  In  that  case  the 
mortgage  is  a  continuing  lien  so  long  as  the  interest 
is  paid  regularly.  For  the  purpose  of  comparison 
with  an  amortized  loan,  let  us  assume  that  a  bor- 
rower has  paid  his  interest  of  $55  annually  for  35 
years.  Then  the  total  amount  of  interest  paid  will 
be  $1,925,  or  $652.50  more  than  that  of  an  amortized 
loan.  The  toll  thus  exacted  by  interest  from  the 
labor  and  capital  of  a  farmer  on  a  straight  mortgage 
for  35  years  would  be  192%  per  cent  as  compared 
with  127%  per  cent  on  an  amortized  farm  mortgage 
loan.  In  either  case  the  toll  is  enormous  and  a  con- 
stant drain  on  a  farmer's  income.  Moreover,  the 
fixed  and  working  capital  of  the  borrower  is  con- 
stantly deteriorating  during  the  period  of  the  loan. 

If  a  soldier  should  undertake  to  purchase  a  farm 
under  an  irrigation  project,  such  as  that  proposed 
by  the  Department  of  the  Interior,  with  the  interest 
rate  placed  at  4%  per  cent,  his  burden  of  indebted- 
ness and  toll  of  interest  would  be  very  large.  Only 
under  the  most  extraordinary  circumstances  could  a 
soldier  settler  expect  to  succeed  at  farming  when  his 
indebtedness  is  likely  to  be  much  greater  than  that 
of  the  average  farmer. 

Evidently,  then,  under  the  easiest  terms  of  repay- 
ing a  loan,  the  payment  of  interest  is  a  heavy  toll 


The  Problem  of  Enrol  Credits          825 

on  the  borrower.  But  at  the  present  time  5%  per 
cent  interest  on  farm  mortgages  is  a  comparatively 
low  rate.  The  applications  for  loans  under  the  fed- 
eral farm  loan  system  show  that  farmers  in  many 
parts  of  the  country  are  paying  8,  10,  and  even  12 
per  cent  interest.  Of  this  fact  there  is  not  a  shadow 
of  a  doubt.  Such  high  rates  of  interest  in  connection 
with  high  taxation  and  other  financial  burdens  prac- 
tically mean  in  many  instances  the  actual  enslave- 
ment of  farmers  to  the  soil  and  to  the  money  lender. 

This  is  the  danger  threatening  the  stability  of 
agriculture  and  the  time  has  come  to  speak  plainly 
on  the  subject.  The  federal  farm  loan  system,  with 
its  low  rate  of  interest  and  amortization  plan  of  re- 
paying loans,  has  loosened  the  shackles  of  financial 
slavery  to  some  extent,  but  it  has  not  broken  them 
completely.  The  latter  is  not  to  be  expected  without 
disrupting  the  present  organization  of  modern  so- 
ciety and  that  is  not  to  be  desired  in  the  interest  of 
real  social  progress. 

The  remedy  for  the  improvement  of  rural  life  con- 
ditions is  to  lower  the  interest  rates  on  farm  loans 
a  great  deal  more  than  has  been  done  by  the  federal 
farm  loan  system,  and  as  previously  suggested  the 
promise  of  success  for  soldier  settlers  lies  also  in 
that  direction.  A  lower  rate  of  interest  and  the 
amortization  plan  of  repaying  a  loan  are  funda- 
mental to  the  reconstruction  of  agriculture.  For  no 
industry  can  possibly  long  survive  where  a  large 


826     The  Place  of  Agriculture  in  Reconstruction 

part  of  the  returns  from  the  labor  and  capital  of  the 
borrower  has  to  be  paid  over  as  interest  and  com- 
missions to  the  money  lender. 

The  burden  of  interest  increases  very  rapidly 
with  the  rise  in  the  rate  charged  on  loans.  The  debt 
itself  is  soon  equaled  by  the  amount  of  interest  paid 
when  the  rate  of  interest  is  high.  Where  a  farmer 
owes  a  large  sum  and  pays  a  high  rate  of  interest  he 
has  little  prospect  of  ever  getting  out  of  debt  in  view 
of  the  precariousness  of  farming  as  a  business.  If 
a  soldier  settler  should  have  a  large  debt  and  a  low 
rate  of  interest,  he  would  still  be  badly  handicapped 
in  getting  firmly  established  as  a  successful  farmer. 
While  the  vast  majority  of  farm  mortgage  loans 
made  by  insurance  companies,  mortgage  firms,  and 
even  private  individuals  are  made  at  rates  varying 
from  5%  to  7  per  cent  interest,  which  are  not  ex- 
cessive in  comparison  with  rates  of  interest  charged 
industry  and  commerce,  there  are  many  unscrupu- 
lous money  lenders  the  country  over,  where  the  se- 
curity is  good  and  increasing  in  value,  who  deliber- 
ately involve  farmers  in  heavy  debt  knowing  full 
well  that  they  are  compelling  these  debt  slaves  to 
toil  for  their  benefit  by  paying  a  high  rate  of  inter- 
est. It  is  seldom  realized  how  soon  the  amount  of 
a  debt  is  equaled  by  interest  payments.  Thus  the 
time  it  would  take  to  pay  as  much  interest  as  the 
principal  of  the  debt  at  different  rates  of  interest 
is  shown  as  follows : 


The  Problem  of  Rural  Credits          327 

Interest  paid  on  $1,000  at    5%  equals  the  debt  in  20  years. 

ti          tt     tt       n      tt       O      K         tt     ft 


(t  ((  it  is  t(  7%  t(  t(  tt  tt  14.  1/7  tt 

t€  it  ti  it  tt  g%  tt  it  it  tt  121/2  «« 

ft  ft  tt  tt  tt  Q0fo  tt  tt  tt  tt  HIM  tl 

tt  €(  ft  tt  ft  10%  tt  ti  tt  it  10  (( 

ft  ft  tt  ft  ft  11%  ft  ti  tt  tt  91/n  (t 

tt  tt  tt  tt  tt  12%  tt  ft  tt  tt 


"When  the  federal  land  banks  raised  the  rate  of 
interest  from  5  to  5%  per  cent,  a  step  backward  was 
made  in  the  efforts  of  the  government  to  encourage 
agricultural  development.  But  even  with  the  inter- 
est rate  raised  to  5%  per  cent  on  farm  mortgage 
loans,  the  burden  of  interest  farmers  have  to  carry 
under  the  federal  farm  loan  system  is  not  heavy  in 
comparison  with  the  average  rate  of  6.9  per  cent 
without  commission  charges  and  7.4  per  cent  with 
commission  charges,  which  prevails  throughout  the 
United  States.  The  average  reduction  to  farmers 
ranges  from  1.4  to  1.9  per  cent. 

But  the  amortization  plan  of  repaying  a  loan  re- 
duces still  more  the  average  rate  of  interest  farmers 
have  to  pay.  As  previously  shown,  the  total  interest 
paid  by  a  farmer  on  a  loan  of  $1,000  at  5%  per  cent 
annual  interest  is  $1,272.50,  the  loan  being  repaid  in 
35  years.  The  average  amount  of  interest  annually 
paid  on  this  basis  is  $36.35,  which  is  equivalent  to  a 
rate  of  interest  of  3.6  per  cent  only.  This  is  a  di- 
rect benefit  to  farmers  who  are  granted  the  privilege 
of  repaying  their  mortgage  loans  on  the  amortiza- 
tion plan.  If  all  farm  mortgage  loans  made  in  the 


328     The  Place  of  Agriculture  in  Reconstruction 

United  States  were  repaid  by  amortization,  it  would 
mean  the  saving  of  millions  of  dollars  annually  to 
farmers  in  interest  charges  alone.  These  benefits 
tend  to  encourage  agricultural  development  and  im- 
prove the  economic  welfare  of  rural  communities. 
They  are  the  direct  results  of  the  establishment  of 
the  federal  farm  loan  system  and  prove  the  finan- 
cial and  economic  advantages  of  the  system  beyond 
the  shadow  of  a  doubt.  They  also  indicate  what 
could  be  accomplished  in  the  way  of  mortgage  credit 
for  soldiers  if  the  government  should  set  itself  to 
the  task  as  earnestly  as  it  did  when  it  undertook  to 
formulate  and  enact  a  farm  mortgage  system  for 
farmers  generally. 

The  Risks  in  Farming 

In  discussing  the  problem  of  land  settlement  for 
soldiers,  frequent  mention  has  been  made  of  the 
precariousness  of  agriculture  as  an  industry  and  the 
need  of  meeting  this  risk  by  favorable  credit  condi- 
tions. The  risks  of  farming  include  both  live  stock 
and  crop  production.  Farm  animals  are  subject  to 
tuberculosis,  the  cattle  tick,  hog  cholera,  and  many 
parasitic  and  other  diseases ;  they  are  attacked  and 
killed  by  such  domestic  and  wild  animals  as  dogs, 
wolves,  coyotes,  mountain  lions,  bobcats  and  lynxes. 
Crops  may  be  injured  or  destroyed  by  early  and  late 
frosts,  winter  killing,  wind  storms,  excessive  rain- 
fall, or  drouth.  "While  no  other  industry  is  so  vital 


The  Problem  of  Enrol  Credits          329 

to  the  increase  and  welfare  of  society,  no  other  in- 
dustry is  so  subject  to  the  forces  of  nature  and  re- 
quires such  constant  effort  to  reap  the  rewards  of 
labor  as  farming.  Moreover,  many  crops  and  manu- 
factured farm  products  are  by  nature  extremely 
perishable  and  must  be  marketed  quickly  to  yield  a 
reward  commensurate  with  the  labor  and  financial 
cost  of  production.  And  if,  in  addition  to  these 
natural  obstacles  to  just  rewards,  farmers  undertake 
to  sell  their  products  through  unscrupulous  commis- 
sion merchants  who  have  been  known  to  render  a 
bill  for  freight  and  other  charges  instead  of  a  check 
for  the  sale  of  the  goods,  the  lot  of  the  rural  toiler 
is  not  only  laborious,  but  on  the  whole  is  probably 
the  least  remunerative  business  in  the  world. 

In  illustration  of  the  precariousness  of  farming 
and  the  importance  of  credit,  let  us  look  briefly  at  the 
effects  of  drouth  and  other  conditions  which  have 
recently  afflicted  certain  parts  of  our  country. 

In  the  Northwest  during  the  two  seasons  of  1917 
and  1918,  the  western  portion  of  North  Dakota  and 
parts  of  Montana  and  Washington  were  subject  to 
severe  winter  weather  and  drouth.  The  result  was 
that  wheat  and  other  grain  crops  were  completely 
destroyed  for  two  years  in  succession.  Similar  con- 
ditions prevailed  in  parts  of  the  Southwest,  par- 
ticularly in  western  Kansas,  Oklahoma,  Texas  and 
eastern  New  Mexico.  Thousands  of  farmers  in  these 
sections  had  not  only  exhausted  their  financial  and 


330     The  Place  of  Agriculture  in  Reconstruction 

credit  resources,  but  were  about  to  abandon  their 
farms  when  the  government  came  to  their  assistance 
in  1918  by  a  special  fund  of  $5,000,000  to  be  loaned 
to  them  for  the  purchase  of  seed  grain  that  they 
might  attempt  to  raise  crops  a  third  season.  Many 
of  these  farmers  were  so  reduced  in  circumstances 
that  they  had  to  find  temporary  employment  either 
in  western  industries  or  on  transportation  lines  in 
order  to  earn  enough  to  support  their  families  and 
carry  their  live  stock  through  the  winter  seasons. 
The  scarcity  of  labor,  due  to  the  war,  made  it  easy 
for  those  farmers  to  find  work  at  that  time, — a  result 
which  might  not  have  been  so  fortunate  had  normal 
labor  conditions  prevailed.  The  object  of  supplying 
government  aid  in  the  form  of  loans  was  to  assist 
in  carrying  farmers  over  the  period  of  distress,  to 
enable  them  to  remain  on  their  farms,  and  to  plant 
what  acreage  in  grain  was  deemed  wise  under  all 
conditions. 

If  a  farmer  had  suffered  from  drouth  for  one  sea- 
son only  he  could  not  receive  aid  under  this  special 
fund.  In  order  to  get  a  loan  at  all  the  farmer  must 
have  had  two  successive  crop  failures  and  be  un- 
able to  borrow  money  elsewhere.  In  other  words 
only  the  farmer  who  was  completely  down  and  out 
was  eligible  for  a  loan.  Even  under  these  most  re- 
strictive conditions  no  less  than  10,641  farmers  were 
accorded  government  loans  at  the  rate  of  $3  •  an 
acre,  with  a  limitation  of  100  acres,  The  total  amount 


The  Problem  of  Rural  Credits          331 

loaned  under  this  arrangement  was  $2,396,460,  leav- 
ing a  balance  of  the  fund  unused  in  the  fall  of  1918 
amounting  to  $2,603,540. 

But  it  was  recognized  by  the  government  agents 
having  charge  of  this  fund  that  there  were  thousands 
of  other  farmers  in  the  drouth-stricken  areas  who 
would  probably  be  in  even  more  urgent  need  of  as- 
sistance to  carry  on  spring  planting  in  1919.  Since 
the  cost  of  seeding  spring  wheat  and  other  cereals 
is  generally  regarded  as  greater  than  for  fall  plant- 
ing, the  loan  amount  was  raised  to  $5  an  acre.  A 
survey  of  the  situation  made  by  the  Department  of 
Agriculture  led  to  the  conclusion  that  the  balance  of 
the  fund  would  take  care  of  the  most  urgent  cases. 

If  farmers  have  not  suffered  from  drouth  for  two 
successive  seasons  or  have  not  exhausted  their 
credit,  they  are  classed  as  the  less  urgent  cases  and 
must  provide  their  own  seed  and  other  farm  require- 
ments. There  are  hundreds  and  probably  thousands 
of  farmers  each  year  who  are  thus  harassed  by  the 
precariousness  of  farming  but  who  are  not  able  to 
receive  government  aid  or  provide  themselves  with 
further  credit  to  continue  their  work.  Many  of  these 
farmers  give  up  and  seek  employment  in  towns  and 
cities,  thereby  adding  to  the  great  urban  social  prob- 
lems of  unskilled  labor  and  unemployment. 

These  are  actual  conditions  which  prevail  as  a 
result  of  natural  forces  which  particularly  affect  the 
agricultural  industry.  They  will  continue  to  en- 


832    The  Place  of  Agriculture  in  Reconstruction 

danger  the  likelihood  of  success  in  farming,  since 
mankind  is  more  or  less  powerless  in  their  presence. 
And  they  are  conditions  which  our  soldier  boys  must 
face,  no  matter  how  physically  fit  they  may  be  to 
carry  on  farming  operations.  If  soldiers  are  en- 
couraged to  take  up  farms,  heavily  involving  them- 
selves in  debt  and  with  no  reserve  capital  to  support 
them  in  case  of  drouth  or  other  calamity,  it  should 
be  with  the  full  knowledge  that  their  chances  of 
success  in  some  parts  of  our  country  would  be  very 
limited  in  the  face  of  natural  law.  A  partial  offset 
to  these  conditions  would  be  to  provide  a  large 
emergency  fund  for  the  making  of  loans  at  a  low  rate 
of  interest. 

But  what  is  likely  to  happen  to  drouth-stricken 
farmers  who  have  taken  advantage  of  government 
aid  if  they  should  fail  the  third  season?  In  that  case 
they  would  most  likely  be  ruined.  For  even  under 
these  conditions  of  distress  and  dire  necessity,  no 
element  of  philanthropic  paternalism  enters  into  the 
agreement  between  the  farmer  and  his  government. 
For  each  farmer  who  received  a  loan  for  seeding  his 
land  "signed  a  promissory  note  for  the  amount  of 
the  loan,  with  interest  at  the  rate  of  6  per  cent,  pay- 
able in  the  fall  of  1919,  and  executed  a  mortgage  giv- 
ing the  government  a  first  lien  on  the  crop  to  be 
grown  on  the  acreage  specified.  Furthermore,  pro- 
vision was  made  for  a  guarantee  fund,  each  bor- 
rower agreeing  to  contribute  15  cents  for  each 


The  Problem  of  Rural  Credits          333 

bushel  in  excess  of  a  yield  of  6  bushels  per  acre 
planted  under  the  agreement.  A  maximum  con- 
tribution of  75  cents  per  acre  was  fixed.  The  ob- 
ject of  this  fund  is  to  safeguard  the  government 
against  loss.  If  it  exceeds  the  loss  it  will  be  re- 
funded pro  rata  to  the  contributors/'  1 

Now  let  us  face  the  situation  as  to  the  risks  in 
agriculture  candidly  and  squarely.  The  figures 
show  that  in  all  probability  no  less  than  20,000  farm- 
ers in  7  or  8  states  lost  all  their  crops  for  two  suc^ 
ceseive  seasons.  Many  others  have  been  afflicted  with 
drouth  for  only  one  season,  making  the  total  num- 
ber of  farmers  who  annually  come  very  near  being 
put  out  of  business  very  large.  But  this  risk  in  agri- 
culture is  so  common  that  it  warrants  some  form  of 
government  aid  if  agricultural  development  is  to  be 
encouraged,  rural  welfare  promoted,  and  farmers  in- 
duced to  stay  on  the  land. 

To  prevent  farmers  from  being  unjustly  exploited 
under  these  conditions,  the  federal  land  banks  of  the 
drouth-stricken  districts  were  designated  as  the 
financial  agents  of  the  government  to  make  and  col- 
lect the  loans  under  the  special  $5,000,000  govern- 
ment fund.  ' '  The  cooperation  of  local  banks, ' '  says 
the  report  of  the  Secretary  of  Agriculture  for  1918, 
"was  sought  and  secured  in  the  taking  of  applica- 
tions and  in  the  temporary  financing  of  farmers 
pending  advances  of  federal  funds  upon  approved 

1Eeport  of  the  Secretary  of  Agriculture  for  1918,  p.  34. 


334     The  Place  of  'Agriculture  in  Reconstruction 

applications  and  the  execution  of  necessary  papers. ' ' 
There  was  practically  no  cost  to  the  taxpayers  in 
handling  this  special  fund.  It  was  borrowed  of  the 
public  by  the  sale  of  government  bonds  at  4%  per 
cent  interest.  The  farmers,  however,  were  charged 
6  per  cent  on  their  loans,  or  a  difference  of  1%  per 
cent.  On  the  basis  of  total  loans  running  a  year 
amounting  to  $2,396,460  the  surplus  interest  above 
the  cost  of  borrowing  would  amount  to  $41,938 ;  and 
for  the  balance  of  the  fund  amounting  to  $2,603,540, 
on  loans  running  for  at  least  six  months,  the  sur- 
plus interest  would  be  $22,781— or  a  total  of  $64,719. 
This  sum  is  comparatively  small  for  disbursing  so 
large  a  fund  in  small  loans,  but  it  is  expected  to  be 
sufficient  to  pay  all  costs  since  the  federal  land  banks 
were  largely  to  be  used  in  making  and  collecting  the 
loans.  In  view  of  the  great  scarcity  of  farm  labor 
and  the  demand  for  agricultural  products,  the  mak- 
ing of  such  loans  was  plainly  a  public  duty  in  order 
to  keep  farmers  in  drouth-stricken  areas  on  the  land. 
But  even  under  these  circumstances  there  was  no 
element  of  philanthropic  paternalism,  for  the  6  per 
cent  interest  paid  by  the  borrowers  will  cover  the 
interest  on  the  bonds  and  the  costs  of  making  and 
collecting  the  loans. 

It  is  not  difficult  to  foresee  what  will  happen  in  the 
future  even  if  the  farmers  working  under  these  con- 
ditions of  drouth  and  debt  should  make  a  normal 
crop.  Many  of  them  having  taken  temporary  posi- 


The  Problem  of  Rural  Credits          335 

tions  either  in  western  industries  or  on  transporta- 
tion lines  will  find  the  means  of  earning  a  living 
much  easier  and  more  certain  than  on  their  farms 
in  areas  subject  to  severe  winter  weather  and  sum- 
mer drouth.  These  farmers  will  doubtless  remain 
in  their  new-found  positions  if  the  least  promise  of 
permanent  employment  is  offered  to  them.  But  if 
they  should  lose  their  crops  the  third  season,  or 
should  meet  with  only  a  partial  crop  failure,  there 
are  likely  to  be  many  thousands  of  abandoned  farms 
in  the  semi-arid  or  drouth-subject  areas  within  a  few 
years.  The  struggle  for  subsistence  against  the 
forces  of  nature  and  unrelenting  interest  rates  cre- 
ates conditions  too  unmerciful  in  their  effects  and 
too  uncertain  in  their  rewards  to  labor  and  capital 
to  win  and  hold  men  to  farming. 

Under  date  of  March  20,  1919,  a  joint  circular 
issued  by  the  Treasury  Department  and  United 
States  Department  of  Agriculture  shows  that  in 
some  instances  the  crops  planted  in  the  fall  of  1918, 
and  mortgaged  to  the  federal  land  banks  as  fiscal 
agents  of  the  government  under  the  plan  for  the 
assistance  of  farmers  in  drouth-stricken  areas,  have 
been  totally  destroyed  by  winter  killing  or  other 
causes,  or  so  nearly  so  as  to  render  the  crops  fail- 
ures. Under  these  conditions  the  farmers  were  given 
permission  to  plow  up  their  land  and  plant  it  to 
other  crops,  if  they  were  able  to  raise  funds  suf- 
ficient to  purchase  the  seeds,  Many  of  them  already 


336     The  Place  of  Agriculture  in  Reconstruction 

having  reached  the  limit  of  their  credit,  it  is  evident- 
ly only  a  question  of  time  when  they  will  have  to 
abandon  their  farms.  The  danger  of  undertaking 
to  farm  in  semi-arid  regions  cannot  be  too  strongly 
emphasized  in  the  face  of  the  present  tendency  to 
encourage  demobilized  soldiers  to  take  up  agricul- 
ture for  a  living. 

Unusual  Features  of  Farm  Mortgage  Credit 

With  the  establishment  of  the  federal  farm  loan 
system  new  features  of  reform  in  farm  finance  were 
introduced  in  the  United  States.  While  instituted 
primarily  to  help  the  small  struggling  farmer  to  pro- 
cure cheap  credit,  the  system  also  benefits  the  in- 
vestor and  mortgage  banker  as  much  as  it  does  the 
borrower.  By  cooperative  borrowing,  farmers  them- 
selves assist  in  furnishing  credit  to  fellow  farmers. 
From  this  point  of  view,  the  rural  credits  movement 
has  in  the  federal  farm  loan  system  one  of  the  most 
interesting  plans  ever  formulated  of  financing  farm- 
ers and  of  aiding  money  lenders  at  the  same  time. 

Two  kinds  of  land  banks  are  created  by  the  farm 
loan  act.  The  first  are  the  federal  land  banks,  which 
were  capitalized  mainly  by  the  government.  This 
class  of  land  banks,  of  which  there  are  12  in  the 
United  States,  can  only  make  loans  to  farmers 
through  local  farm  loan  associations  composed  of 
not  less  than  10  members.  They  operate  in  their 


The  Problem  of  Rural  Credits          337 

own  districts,  which  were  defined  by  the  farm  loan 
board. 

The  other  class  of  land  banks  is  organized  and 
operated  by  private  capitalists.  They  are  dis- 
tinguished by  the  name  of  joint  stock  land  banks 
and  can  make  loans  to  individual  farmers  only.  They 
operate  in  the  state  in  which  they  have  their  prin- 
cipal office  and  in  one  contiguous  state.  That  is,  a 
joint  stock  land  bank  can  operate  in  any  two  con- 
tiguous states  of  its  own  selection. 

Both  classes  of  land  banks  can  make  loans  only 
on  first  mortgage  on  farms  or  farm  lands  up  to  50 
per  cent  of  the  appraised  value  of  the  land  and  20 
per  cent  of  the  appraised  value  of  the  permanent 
insurable  improvements.  They  may  charge  interest 
as  high  as  6  per  cent,  but  are  prohibited  from  charg- 
ing a  commission  on  loans  under  any  pretense  what- 
soever. 

In  procuring  a  loan  of  a  federal  land  bank,  each 
borrower  is  obliged  to  subscribe  for  stock  in  his  as- 
sociation to  the  amount  of  5  per  cent  of  his  loan; 
and  the  association  in  turn  has  to  subscribe  for  a 
similar  amount  of  stock  in  the  federal  land  bank. 
Indirectly,  then,  each  farmer  who  borrows  of  a  fed- 
eral land  bank  increases  its  capital  to  the  amount 
of  5  per  cent  of  his  loan.  On  the  other  hand,  a  bor- 
rower of  a  joint  stock  land  bank  has  to  make  no 
subscription  to  its  capital  stock. 

Besides  the  original  capital  of  the  two  kinds  of 


338     The  Place  of  Agriculture  in  Reconstruction 

land  banks,  they  procure  money  to  lend  to  farmers 
by  the  issue  and  sale  of  bonds.  The  first  mortgages 
taken  on  farms  by  means  of  loans  made  from  the 
original  capital  are  pledged  as  security  for  a  bond 
issue  equaling  their  amount  in  value.  When  these 
bonds  are  sold,  the  proceeds  are  again  loaned  to 
farmers  and  other  first  mortgages  on  farms  taken 
as  security.  These  mortgages  are  again  in  turn 
pledged  for  another  bond  issue.  The  federal  land 
banks  and  joint  stock  land  banks  are  given  power  to 
issue  bonds  up  to  20  times  and  15  times  their  capital 
and  surplus,  respectively. 

Since  each  borrower  of  a  federal  land  bank  in- 
creases its  capital  to  the  amount  of  5  per  cent  of  his 
loan,  provision  is  thus  made  by  the  issue  of  bonds  to 
20  times  the  capital  to  procure  $1,000  to  lend  for 
every  $50  of  stock  subscribed.  The  law,  however, 
limits  the  differential  between  the  interest  rate  on 
farm  loan  bonds  and  the  rate  of  interest  on  mort- 
gages to  1  per  cent.  That  is,  if  bonds  are  issued  at 
4%  or  5  per  cent  interest,  the  rate  of  interest  on 
farm  mortgages  in  the  former  case  cannot  exceed 
5%  per  cent  and  in  the  latter  case  6  per  cent,  which 
is  the  maximum  rate  permissible  under  the  act.  But 
by  the  issue  of  bonds  and  this  differential  of  1  per 
cent,  the  federal  land  banks  are  able  to  receive  a 
gross  income  on  their  capital  of  20  per  cent  and  the 
joint  stock  land  banks  of  15  per  cent. 

Another  unusual  feature  is  that  first  mortgages 


The  Problem  of  Rural  Credits          339 

executed  to  the  two  kinds  of  land  banks  and  the 
farm  loan  bonds  issued  by  them  are  held  to  be  in- 
strumentalities of  the  government  of  the  United 
States,  and  as  such  both  mortgages  and  bonds,  as 
well  as  the  income  therefrom,  are  exempt  from  fed- 
eral, state,  municipal  and  local  taxation. 

The  great  advantage  of  this  provision  to  the  fed- 
eral system  of  making  farm  mortgage  loans  is  now 
quite  generally  recognized.  With  a  lower  interest 
rate  granted  to  borrowers, — with  the  mortgages, 
bonds,  and  income  from  them  exempted  from  taxa- 
tion,— a  great  inroad  has  been  made  in  the  farm 
mortgage  business  of  insurance  societies  and  mort- 
gage companies.  This  business  with  renewals  is  es- 
timated in  volume  at  about  $400,000,000  a  year.  Dur- 
ing the  twelve  months  ending  November  30, 1918,  the 
federal  land  banks  alone  had  made  new  loans 
amounting  to  $117,628,206.  As  the  joint  stock  land 
banks  increase  in  number,  they  too  may  be  expected 
to  do  a  large  business  in  farm  mortgage  loans. 

In  attempting  to  work  out  a  system  of  mortgage 
credit  for  soldiers  and  sailors,  the  federal  farm  loan 
system  could  be  taken  as  a  working  model.  But  as 
it  stands  to-day,  it  would  not  be  adapted  to  their 
needs.  The  term  of  the  loan  is  not  sufficiently  long 
nor  is  the  rate  of  interest  low  enough  for  those  about 
to  take  up  farming.  A  system  for  soldiers  should 
be  developed  to  give  them  the  fullest  benefits  pos- 
sible. Both  the  federal  land  banks  and  joint  stock 


340     The  Place  of  Agriculture  in  Reconstruction 

land  banks  benefit  more  from  this  system  than  do 
the  farmers  who  borrow.  The  saving  to  the  farmer 
is  the  difference  in  the  present  interest  rates  of  5% 
or  6  per  cent  and  that  which  they  would  have  to  pay 
if  the  federal  system  was  not  in  existence.  This 
saving  in  interest  rates  averages  probably  1  or  2 
per  cent  a  year.  But  the  gain  to  the  land  banks 
is  the  difference  between  the  usual  rate  of  6  or  7 
per  cent  interest  received  for  farm  mortgage  loans 
and  the  gross  income  of  15  to  20  per  cent  received 
through  the  sale  of  bonds.  The  gain  to  the  joint 
stock  land  banks  will  be  about  8  per  cent  on  their 
invested  capital  and  surplus,  while  to  the  federal 
land  banks  the  gain  is  at  least  12  per  cent.  These 
gains  are  based  on  the  assumption  that  these  classes 
of  banks  are  able  to  sell  their  bonds  up  to  the  limits 
provided  by  the  farm  loan  act. 

In  illustration  of  the  advantages  of  this  plan  of 
providing  money  for  establishing  soldiers  on  the 
land  and  thereby  encouraging  agricultural  develop- 
ment, let  us  compare  the  capital  of  the  land  banks 
with  the  volume  of  loans  made  as  a  result  of  selling 
bonds  based  on  farm  mortgage  security. 

On  February  1,  1919,  the  total  capital  of  the  12 
federal  land  banks  amounted  to  $17,287,311,  of 
which  $8,765,415  was  subscribed  by  the  government, 
$8,419,840  by  farmer  borrowers,  and  the  balance  of 
$102,056  by  non-borrowing  individual  subscribers. 
But  farm  mortgage  loans  had  been  made  to  the 


The  Problem  of  Rural  Credits          341 

amount  of  $168,213,931,  or  nearly  10  times  the 
capital. 

Similar  data  for  9  joint  stock  land  banks  to  De- 
cember 1,  1918,  are  total  paid-in  capital  $2,375,000, 
and  mortgage  loans  made  amounting  to  $7,289,600, 
or  more  than  3  times  the  capital. 

But  all  of  the  latter  class  of  banks  have  been  do- 
ing business  a  much  shorter  time  than  the  federal 
land  banks,  many  of  them  having  only  recently  been 
chartered,  they  are  operated  entirely  by  private 
capital,  and  they  have  to  sell  their  own  bonds  to 
private  investors.  But  by  an  amendment  to  the  farm 
loan  act,  the  Treasury  is  authorized  to  buy  the  bonds 
issued  by  the  federal  land  banks,  and  on  April 
1,  1919,  there  were  owned  by  the  government  farm 
loan  bonds  to  the  value  of  $88,920,000. 

While  chartered  land  banks  are  $ble  in  this  way  to 
multiply  their  capital  and  surplus  enormously  in 
order  to  make  loans  to  farmers,  insurance  societies, 
mortgage  companies,  and  individuals  accustomed  to 
lend  money  on  farm  mortgages  are  restricted  to  the 
actual  number  of  loans  that  can  be  made  with  the 
money  in  hand,  since  they  cannot  create  a  revolving 
fund  by  the  issue  and  sale  of  bonds.  It  is  this  great 
advantage  accorded  both  federal  and  joint  stock 
land  banks,  in  addition  to  the  tax  exemption  feature 
of  farm  loan  bonds,  which  makes  this  system  unique 
as  a  means  of  supplying  money  for  agricultural 
credit. 


342     The  Place  of  Agriculture  in  Reconstruction 

A  Federal  System  for  Soldiers 

The  foregoing  facts  and  figures  plainly  indicate 
that  private  sources  of  capital  would  not  be  adequate 
to  finance  land  settlement  by  soldiers  and  sailors  on 
an  extensive  scale.  The  applications  for  loans  by 
actual  farmers  are  now  so  numerous  that  the  federal 
agencies  established  by  the  farm  loan  act  cannot 
supply  the  demand  month  by  month.  There  is  every 
indication  that  soldier  settlers  will  be  in  still  greater 
need  of  capital.  The  letters  which  come  from  sol- 
diers in  camp  at  home  and  abroad  contain  inquiries 
as  to  the  plan  the  government  may  have  formulated 
for  enabling  men  to  equip  their  farms  after  they 
have  settled  upon  the  land.  While  no  definite  plan 
has  yet  been  formulated,  it  is  generally  conceded 
that  the  federal  farm  loan  system  is  most  suggestive 
if  it  were  modified  to  meet  the  requirements  of  sol- 
diers who  are  not  likely  to  possess  much  capital. 
Australia,  New  Zealand,  Canada,  and  other  coun- 
tries have  requested  information  on  the  subject  with 
a  view  of  establishing  a  farm  mortgage  credit  system 
for  their  returned  soldiers  who  desire  to  take  up 
farming  as  a  life  work. 

The  advantages  of  a  bond-selling  system  are  that 
it  requires  a  comparatively  small  amount  of  original 
capital  while  accommodating  a  much  greater  num- 
ber of  borrowers.  As  previously  pointed  out,  the 
primary  effect  of  the  bond-selling  function  is  to  in- 


The  Problem  of  Rural  Credits          343 

crease  the  number  of  farmers  whose  labor  and  capi- 
tal can  be  utilized  in  the  production  of  agricultural 
wealth.  Thus,  on  February  1, 1919,  the  federal  land 
banks  had  made  loans  to  71,204  farmers  for  $168,- 
213,931,  or  an  average  loan  of  $2,362.  If  these 
banks  in  making  loans  had  been  limited  to  their 
capital,  they  could  have  made  loans  to  7,320  farmers 
only  on  the  basis  of  the  loan  average  instead  of  to 
71,204.  The  difference  of  63,884  farmers  is  the  in- 
creased number  who  have  been  accommodated  with 
loans  as  a  result  of  the  privilege  of  issuing  bonds 
on  farm  mortgage  security.  When  the  limit  of  the 
privilege  has  been  reached,  for  every  farmer  to 
whom  a  loan  has  been  made  from  the  capital  of  a 
federal  land  bank  20  other  farmers  can  be  accom- 
modated by  means  of  the  funds  derived  from  the  sale 
of  bonds ;  and  in  the  case  of  joint  stock  land  banks 
the  number  that  could  be  accommodated  would  be 
15  farmers. 

But  if  soldiers  are  to  become  farmers  and  remain 
on  the  land,  the  first  condition  of  success  is  a  low 
interest  rate.  A  high  interest  rate  can  only  be 
paid  out  of  the  toil  and  sweat  of  the  borrower.  The 
money  would  be  borrowed,  no  doubt,  to  erect  build- 
ings, make  improvements,  and  purchase  capital 
equipment.  With  every  returning  six  months  or  year 
the  inexorable  toll  of  interest  has  to  be  paid  no  mat- 
ter what  harvest  has  or  has  not  been  reaped.  In 
the  meantime  the  buildings,  improvements  and  equip- 


344     The  Place  of  Agriculture  in  Reconstruction 

ment  are  depreciating  in  value  and  must  sooner  or 
later  be  repaired  or  replaced.  This  means  a  new 
loan  and  an  additional  burden  unless  fortune  has 
smiled  upon  a  farmer's  efforts  more  than  usual.  But 
under  ordinary  conditions  of  farming  a  high  inter- 
est rate  for  the  average  soldier  settler  would  mean 
a  long  period  of  enslavement  to  the  money  lender. 
For  this  reason  there  is  little  prospect  of  benefit  to 
the  returned  soldier  in  procuring  a  loan  under  the 
federal  farm  loan  system. 

Our  soldiers  and  sailors  would  not  be  more  likely 
to  succeed  as  farmers  than  those  now  engaged  in 
agriculture.  With  a  uniform  and  comparatively  low 
rate  of  interest  prevailing  all  over  the  United  States, 
many  of  the  borrowers  under  the  federal  farm  loan 
system  have  been  unable  to  pay  their  instalments 
on  loans,  notwithstanding  the  easy  amortization  plan 
of  repayment.  The  total  delinquencies  on  Febru- 
ary 1,  1919,  were  $83,384,  and  10  of  the  12  federal 
land  banks  have  such  defaulted  instalments.  In 
the  face  of  the  material  risks  of  a  very  precarious 
industry,  farmers  find  their  financial  burdens  diffi- 
cult to  bear.  Many  of  the  more  intelligent  farmers 
are  beginning  to  realize  that  they  have  not  bene- 
fited as  much  from  the  system  as  they  anticipated. 
They  now  complain  that,  if  assessments  are  levied 
to  pay  the  expenses  of  their  associations,  they 
practically  are  equivalent  to  the  commission  for- 
merly charged  for  making  or  renewing  a  loan  every 


The  Problem  of  Rural  Credits          345 

few  years;  and  that  the  lack  of  dividends  on  their 
stock  in  the  associations  adds  somewhat  to  their 
rate  of  interest.  On  the  other  hand,  it  must  not  be 
forgotten  that  to  the  masses  of  farmers  who  were 
formerly  paying  8,  10  or  12  per  cent  interest  on 
loans,  the  federal  farm  loan  system  has  been  a  veri- 
table blessing  and  the  only  hope  of  their  financial 
salvation.  Evidently,  then,  with  the  great  problems 
of  reconstruction  before  the  American  people,  a 
low  interest  rate  on  loans  to  soldiers  is  absolutely 
imperative  if  they  are  expected  to  establish  them- 
selves firmly  on  the  land. 

Besides  interest  payments  on  loans,  there  is  the 
question  of  the  upkeep  of  the  farm,  which  a  land- 
owner must  ever  face.  This  is  true  even  where  loans 
run  as  long  as  35  or  40  years  as  under  the  federal 
system.  Improvements  and  capital  equipment  will 
have  depreciated  in  value  and,  in  many  instances, 
will  be  in  need  of  renewal  long  before  that  time  has 
elapsed.  But  the  regular  instalments  on  loans  must 
be  met  no  matter  how  destructive  the  season  has 
been  to  crops  and  live  stock  or  how  much  has  been 
expended  for  the  upkeep  of  the  farm. 

And,  lastly,  there  is  the  matter  of  increasing  taxa- 
tion which  a  landowning  soldier  farmer  must  face. 
With  the  Secretary  of  the  Treasury  asking  authority 
of  Congress  to  issue  government  obligations  in  al- 
most incomprehensible  figures,  saying  that  the  pub- 
lic needs  will  require  at  least  $18,000,000,000  for  the 


346     The  Place  of  Agriculture  in  Reconstruction 

fiscal  year  of  1919,  and  probably  $10,000,000,000  for 
1920?  any  delusion  we  may  have  entertained  for  a 
prompt  decrease  in  taxation,  now  that  hostilities  have 
ceased,  has  been  rudely  dissipated.  The  American 
farmer  must  face  the  prospect  of  increasing  taxa- 
tion with  a  cheerful  countenance  the  same  as  all 
other  taxpayers.  These  are  the  mortgage  credit 
problems  which  face  our  soldier  settlers  as  a  result 
of  the  burdens  of  interest,  depreciation  of  capital 
equipment,  and  increasing  taxation. 

Evidently,  the  problem  of  land  settlement  by  sol- 
diers cannot  be  satisfactorily  solved  apart  from  a 
legislative  program  that  will  provide  special  credit 
privileges  not  afforded  by  existing  private  or  pub- 
lic agencies.  The  preceding  pages  have  brought  us 
face  to  face  with  the  two  chief  social  forces,  namely, 
high  interest  rates  and  increasing  taxation,  which 
have  played  their  part  in  holding  back  the  progress 
of  agriculture.  Fortunately,  they  are  both  within 
legislative  control.  One  force  may  be  regarded  as  a 
toll  on  labor  and  the  other  as  a  toll  on  capital.  But 
farming  is  a  unique  industry,  for  a  farm  is  both  a 
home  and  a  factory.  On  the  farm  there  is  and  can 
be  no  conflict  between  capital  and  labor,  for  the 
farmer  who  cultivates  his  own  land  is  both  worker 
and  employer.  As  such  the  toll  of  interest  and  tax- 
ation is  taken  from  the  one  individual,  thus  making 
the  farmer's  burden  harder  to  bear  alone. 

With  the  progress  of  society  there  has  been  an 


The  Problem  of  Rural  Credits          347 

ever-growing  toll  taken  from  the  products  of  both 
labor  and  capital.  If  labor  fails  to  perform  its  task 
and  capital  lies  idle  so  that  wealth  is  no  longer 
produced  by  their  cooperation,  nevertheless  the  in- 
terest on  borrowed  money  and  the  taxes  on  property 
values  must  be  paid.  This  is  the  present  way  of  the 
social  world  and  it  cannot  be  radically  changed  with- 
out threatening  the  very  foundations  of  civilization. 

Has  not  the  time  come,  therefore,  for  rural  and 
urban  populations  to  stop  long  enough  in  their  cease- 
less toil  and  turmoil  to  ask  themselves  the  question 
— What  is  the  remedy  for  rural  depopulation  and 
urban  over-population  which  create  a  scarcity  of 
labor  on  farms  and  unemployment  in  cities?  And  if 
the  facts  here  presented  warrant  any  answer  it  is 
this :  That  interest  rates  on  farm  loans  and  on  city 
property  must  be  lowered  and  that  political  pater- 
nalism must  be  immediately  checked. 

Unless  these  results  are  soon  accomplished,  the 
glories  of  democracy  may  not  unlikely  pass  into  the 
shameful  semblance  of  incipient  anarchy.  It  has 
taken  centuries  of  exploitation  to  bring  the  social 
world  to  its  present  chaotic  condition ;  and  progress 
toward  an  ideal  state  of  social  justice  and  financial 
equity  must  also  be  made  step  by  step.  Evolution  is 
progressive  development  toward  a  higher  social  life. 
These  are  the  lessons  which  a  study  of  rural  credits 
presents  to  a  world  waiting  to  behold  the  dawning 
of  a  better  and  a  happier  day. 


CHAPTER  XIIL— THE  RECONSTRUCTION  OF 
AGRICULTURE  AND  ITS  RELATION  TO  NA- 
TIONAL WELFARE 

My  task  is  nearly  done.  In  the  preceding  pages 
an  attempt  has  been  made  to  point  out  the  place  of 
agriculture  in  the  great  problems  of  reconstruction 
which  will  perplex  our  own  people  as  well  as  the 
nations  of  the  world  for  the  next  ten  years.  The 
last  step  is  to  trace  a  little  more  fully  the  relation  of 
agriculture  to  our  national  welfare. 

In  dealing  with  this  phase  of  the  subject  it  must 
be  borne  in  mind  that  men  toil  to  provide  themselves 
and  their  families  with  food,  fuel,  clothing  and 
shelter.  All  the  absolute  needs  of  life  are  included 
in  these  four  terms.  But  then  there  are  economic 
and  social  phases  of  rural  life  which  add  to  the  in- 
ducements to  labor  and  lead  to  saving  and  the 
accumulation  of  wealth.  Progress  in  civilization 
means  just  rewards  for  the  labor  of  production,  se- 
curity in  the  possession  of  one's  property,  attrac- 
tive and  healthful  home  surroundings,  and  the  ad- 
vantages of  education.  If  farming  and  rural  life  can 
not  be  made  profitable,  healthful  and  attractive, 
men  with  their  families  will  be  apt  to  seek  improve- 

348 


The  Reconstruction  of  Agriculture       349 

ment  in  their  economic,  domestic  and  social  relations 
in  towns  and  cities  where  the  prospects  of  securing 
better  and  easier  conditions  of  life  at  least  seem  to 
be  offered  to  our  rural  population. 

Improvement  of  Rural  Life  Conditions 

Fundamentally,  the  problem  of  agriculture  cen- 
ters in  making  farming  more  profitable.  If  farmers 
produce  wealth  from  the  soil  in  sufficient  abundance 
to  provide  themselves  and  their  families  with  the 
necessities  and  comforts  of  life  for  which  men  strive, 
and  if  they  are  not  unduly  exploited  financially  and 
politically,  they  will  as  a  rule  fit  their  homes  with 
modern  conveniences  which  make  domestic  life  pleas- 
ant er,  and  will  add  to  the  attractiveness  of  their 
surroundings  with  paint  and  brush,  with  shrubs  and 
flowers,  with  lawn  and  garden — in  short  will  aim  to 
soften  the  drudgery  of  farm  work  with  natural  and 
artificial  pleasures  which  attract  the  eye  and  appeal 
to  the  esthetic  side  of  human  nature.  But  neither 
farmers  nor  any  other  class  of  wealth  producers  can 
cultivate  their  minds  and  raise  their  standard  of 
living  if  a  great  part  of  their  time  has  to  be  spent  in 
earning  a  mere  living  either  from  the  soil  or  other- 
wise. If  farming  can  be  made  more  profitable,  then 
all  those  things  will  be  added  to  rural  life  which  put 
to  shame  for  their  real  uplifting  influence  the  so- 
called  "attractions"  of  town  or  city  life. 

For  many  years  a  program  of  reconstruction  in 


350     The  Place  of  Agriculture  in  Reconstruction 

agriculture  and  rural  life  has  been  conducted  in  all 
its  economic  and  social  phases.  This  is  not  now  a 
post-war  program  and,  so  far  as  the  United  States 
is  concerned,  is  in  no  way  connected  with  the  Euro- 
pean war.  The  need  of  improvement  in  rural  life 
conditions  was  earnestly  realized  fifteen  or  twenty 
years  ago.  By  degrees  the  program  has  been  en- 
larged to  take  in  problems  of  production,  marketing, 
purchasing  supplies,  transportation  and  finance  in 
the  economic  phases  of  farming;  while  the  social 
phases  sought  improvement  in  education,  sanitation, 
recreation,  beautifieation  and  domestic  economy. 
To-day  every  effort  is  being  made  by  our  state  col- 
leges of  agriculture  to  carry  these  economic  and  so- 
cial advantages  into  every  rural  community.  And 
yet,  in  the  face  of  all  these  efforts,  hundreds  of  farm- 
ers are  annually  leaving  farm  life  to  take  up  other 
pursuits  or  are  being  driven  from  their  farms  be- 
cause of  the  unprofitableness  of  their  labor  and 
capital  employed  therein. 

It  is  useless  to  attempt  to  induce  men  to  carry  on 
farming  operations  if  they  cannot  make  a  decent  liv- 
ing thereby  for  themselves  and  their  families.  Farm- 
ers could  not  enjoy  the  economic  and  social  advan- 
tages enumerated  above  if  they  have  to  labor  con- 
tinually from  morning  till  night  and  every  day  in 
the  week  to  earn  a  poor  living  at  the  best.  It  is  only 
a  mockery  to  talk  improvement  of  rural  life  condi- 
tions if  they  cannot  be  realized  even  with  the  most 


The  Reconstruction  of  Agriculture       351 

strenuous  efforts  that  a  farmer  can  put  forth.  And 
this  is  the  actual  state  of  affairs  with  thousands  of 
farmers  all  over  the  United  States.  It  is  funda- 
mentally a  struggle  for  a  comfortable  existence  and 
there  can  be  no  sound  rural  life  policy  until  this  re- 
sult has  been  accomplished. 

There  are  only  two  ways  in  which  this  result  can 
be  brought  about,  namely,  by  making  the  soil  more 
productive  or  by  lightening  the  financial  and  po- 
litical burdens  affecting  agriculture.  But  increas- 
ing the  productivity  of  the  soil  to  any  great  extent, 
with  a  shortage  of  fertilizers  and  in  the  face  of  natu- 
ral forces,  will  not  be  apt  to  bring  farmers  a  much 
larger  income.  All  the  economic  and  social  projects 
formulated  for  improving  rural  life  conditions  may 
either  be  carried  out  by  the  farmers  themselves  pro- 
vided their  income  is  sufficient  for  the  purpose,  or, 
if  carried  out  under  state  supervision  and  control, 
add  to  the  farmer's  burden  by  increasing  his  taxes. 
The  promotion  of  rural  education,  domestic  science, 
and  farm  finance  means  improved  living  conditions 
perhaps,  but  they  cannot  be  carried  on  in  any  rural 
community  without  cost.  To  meet  this  condition 
most  satisfactorily  is  to  enable  farmers  to  reap  larg- 
er rewards  from  their  labor  and  capital  and  to 
lower  the  toll  of  interest  and  taxes  annually  taken 
from  their  income.  These  seem  to  be  the  ultimate 
means  of  solution  of  the  rural  life  problem. 

No  intelligent  farmer  looks  for  any  great  change 


352     The  Place  of  Agriculture  in  Reconstruction 

in  the  working  conditions  of  his  business.  It  is  an 
industry  not  regulated  on  a  factory  basis.  The  raw 
materials  of  production  are  not  brought  and  stored 
in  warehouses  ready  to  be  worked  up  into  objects  of 
wealth  as  the  market  demands  rise  and  fall.  But  the 
farmer  must  plow  his  fields  and  sow  his  seed  as  the 
season  favors ;  he  must  reap  his  crops  not  when  he 
wills  but  when  they  are  ready  for  the  harvest  and 
only  then  if  natural  conditions  are  favorable;  and 
he  must  care  for  his  live  stock  every  day  of  the  year. 
A  farmer's  working  hours  are  regulated  not  by  an 
employer  in  agreement  with  his  employees  by  col- 
lective bargaining,  but  by  the  inexorable  laws  of  na- 
ture, which  know  no  rest  and  provide  no  holidays. 
The  man  who  chooses  farming  as  a  means  of  liveli- 
hood must  expect  to  work  hard,  and  long,  and  have 
irregular  hours  of  service.  The  inducement  to  ac- 
cept such  conditions  of  labor  is  the  hope  of  reward 
which  rises  eternal  in  the  human  breast.  If  this  ex- 
pectation is  not  realized,  the  ambition  to  work  is 
removed.  This  is  another  aspect  of  farming  which 
must  be  faced  in  attempts  to  improve  rural  life 
conditions,  for  there  are  some  things  which  cannot 
be  brought  within  the  regulatory  functions  of  the 
state  or  nation. 

The  Wealth  of  Agriculture 

But  where  the  state  can  exert  an  influence  for  the 
improvement  of  rural  conditions  it  is  its  plain  duty 


The  Reconstruction  of  Agriculture       353 

to  do  so  because  of  the  absolute  dependence  of  the 
population  upon  the  products  of  agriculture.  The 
amount  of  wealth  annually  produced  from  the  soil  is 
seldom  realized,  nor  is  there  any  just  conception  of 
the  extent  to  which  the  products  of  the  fields  enter 
into  the  industrial  and  commercial  life  of  a  nation. 
There  are  fruits,  vegetables,  cereals,  meats,  milk, 
poultry,  butter  and  eggs,  which  form  the  staple  foods 
for  every  home  in  the  land;  there  are  flax,  hemp, 
cotton  and  wool,  which  form  the  raw  materials  of  the 
textile  industries;  there  are  hides  for  shoes  and 
other  leather  goods ;  lumber  for  houses,  barns,  build- 
ings, and  many  other  uses — in  short,  no  industry 
produces  such  a  variety  of  goods  which  are  so  essen- 
tial to  the  life  and  well-being  of  all  the  people. 

The  value  of  farm  products  annually  raised  stag- 
gers the  imagination.  It  is  estimated  not  in  millions 
but  in  billions  of  dollars.  For  the  year  1918  the  crops 
and  live  stock  on  farms  were  valued  at  nearly  twenty- 
five  billions  of  dollars.  And  still  the  nation  does  not 
grow  wealthy  because  most  of  these  goods  are  con- 
sumed as  fast  as  they  are  produced  or  within  a  short 
time  thereafter.  They  are  the  energizing  force  of 
individual  and  national  life ;  without  them  mankind 
would  perish  from  the  face  of  the  earth.  They  help 
to  keep  the  wheels  of  transportation  in  motion  and 
supply  the  raw  materials  for  many  manufactures. 
In  the  reconstruction  problems  which  are  before  us 
and  which  will  continue  to  arise,  the  place  of  agri- 


354»     The  Place  of  Agriculture  in  Reconstruction 

culture  is  in  the  front  rank  for  friend  and  foe  alike. 
The  wealth  created  by  farming  provides  all  four  es- 
sential needs  of  life — food,  fuel,  clothing  and  shelter. 
It  is  the  only  industry  which  is  so  generally  useful 
to  mankind.  And  agriculture  will  not  only  continue 
to  lavish  her  wealth  to  sustain  and  comfort  mankind 
for  a  day  or  a  year,  but  for  ten  years,  a  hundred 
years,  for  all  time. 

The  relation  of  this  great  industry  to  our  national 
welfare  deserves  at  least  a  passing  notice.  Not  only 
do  many  food  products  enter  daily  into  every  home, 
but  all  have  to  be  transported  on  land  or  by  water- 
in  wagon,  railroad  car,  or  steamship — from  the  ru- 
ral districts  to  every  hamlet,  town  and  city  through- 
out the  land.  Being  in  bulk  they  require  vast  num- 
bers of  carrying  vehicles  to  bear  them  from  one  part 
of  the  country  to  another,  and  this  means  the  em- 
ployment of  thousands  of  men  in  the  transportation 
industries.  When  they  reach  their  destination,  many 
of  the  raw  food  products  are  finished  or  manufac- 
tured into  high-grade  goods,  such  as  cheese,  flour, 
cereal  products,  meats,  canned  fruits  and  vegetables, 
and  a  hundred  other  foods  which  furnish  mankind 
with  its  daily  bread  in  countless  variety.  In  all  these 
instances  which  require  the  finishing  or  manufactur- 
ing of  foods  and  luxuries,  men,  women  and  children 
are  employed  in  great  numbers ;  and  in  all  such  cases 
where  foods  and  farm  products  are  transferred  from 
producer  to  ultimate  consumer  there  is  no  increase 


The  Reconstruction  of  Agriculture       355 

in  the  amount  of  wealth  but  in  the  cost  of  the  goods 
thus  transported  and  transformed. 

This  combination  of  economic  and  social  forces 
raises  the  price  of  foods  and  affects  the  standard  of 
living  of  millions  of  workers  who  depend  for  sub- 
sistence on  a  weekly  wage.  For  the  consuming  power 
depends  upon  the  earning  ability  of  the  masses  of 
our  population.  But  the  consumption  of  foods  in 
sufficient  quantity  and  variety  to  properly  nourish 
the  human  body  provides  a  correct  standard  of  liv- 
ing and  means  better  health  and  greater  happiness. 
The  greater  the  quantity  of  foods  and  farm  products 
consumed  the  greater  will  be  the  demand  upon  agri- 
culture, and  thus  the  round  of  life  begins  and  ends  in 
the  products  of  the  farm.  In  a  word,  agriculture 
means  the  health,  the  well-being,  and  the  life  of  the 
race. 

But  while  all  the  people  depend  upon  the  produc- 
tion of  food  supplies,  only  a  part  are  directly  af- 
fected by  their  transportation,  their  finishing,  and 
their  manufacture.  But  even  here  again  the  number 
directly  and  indirectly  affected  may  mount  up  into 
the  millions.  For  when  there  are  less  farm  products 
to  be  transported  or  transformed,  there  is  less  de- 
mand for  carrying  vehicles,  for  machinery,  for  wood, 
glass,  tin  and  paper  utensils,  and  for  numerous  ac- 
cessories which  depend  for  their  use  upon  raising, 
transforming  and  preserving  of  foods.  If  the  raw 
products  of  farms  are  valued  annually  at  about 


356     The  Place  of  Agriculture  in  Reconstruction 

$25,000,000,000,  who  can  give  us  an  estimate  of  their 
value  when  finally  made  ready  for  the  use  of  man? 
And  it  is  this  difference  in  value  which  has  been  cre- 
ated by  the  varied  forms  they  take  when  additional 
labor  is  applied  to  them,  and  by  the  value  of  the  ac- 
cessories which  transport,  transform  and  preserve 
them  for  future  use.  From  the  standpoints  of  food 
production  and  food  consumption  alone,  the  relation 
of  agriculture  to  economic  and  social  welfare  takes 
a  supreme  place  among  all  the  industries  in  the 
world.  For  besides  the  millions  of  farmers  and  farm 
workers  directly  engaged  in  the  production  of  foods 
and  food  supplies,  there  are  other  millions  of  our 
population  who  earn  their  living  by  performing  work 
connected  with  their  transportation,  manufacture 
and  distribution. 

But  let  us  glance  at  the  final  distribution  of  natu- 
ral and  prepared  food  supplies  which  requires  the 
employment  of  hundreds  of  thousands  of  workers. 
The  great  bulk  of  natural  farm  products  go 
through  the  hands  of  commission  merchants  and 
through  them  to  retail  dealers,  who  sell  to  consumers. 
Many  of  the  raw  products  shipped  from  orchard, 
garden  and  farm  are  extremely  perishable.  This 
feature  emphasizes  the  need  for  the  best  facilities 
for  their  grading  and  marketing  so  as  to  bring  the 
best  returns  to  the  producers  and  the  best  goods  in 
the  best  condition  to  consumers.  The  daily  call  of 
cities  is  for  fresh  milk,  poultry,  eggs,  meat,  butter, 


The  Reconstruction  of  Agriculture       357 

fruits  and  vegetables.  But  before  these  food  sup- 
plies in  their  natural  condition  can  be  delivered  at 
the  door  of  every  home,  their  transportation  to  the 
centers  of  population,  which  constitute  the  chief 
markets,  involves  long  hauls  in  fast  trains  especially 
equipped  for  just  such  traffic.  Thus  railroad  cars 
must  be  iced  and  well  ventilated  in  summer  and 
warmed  in  winter.  Great  care  must  be  exercised  in 
the  handling  of  such  goods,  and  delivery  must  be 
made  promptly  on  arrival  at  destination  or  deteri- 
oration in  food  and  money  value  will  occur.  The 
transportation  of  perishable  agricultural  products 
as  a  rule  requires  numbers  of  skilled  laborers,  care- 
ful supervision  and  management,  and  special  service. 
Thousands  of  men  are  employed  in  moving,  market- 
ing and  distributing  natural  food  supplies  to  every 
household. 

But  look  again  at  the  vast  number  of  people  who 
are  employed  directly  and  indirectly  in  the  prepara- 
tion and  distribution  of  dried  and  canned  foods. 
There  are  factories  without  number  with  thousands 
of  employees  at  one  end  of  the  process  and  tens  of 
thousands  of  grocery  stores  with  hosts  of  retail 
clerks  and  delivery  boys  at  the  other  end.  Grocery 
stores  deal  largely  in  both  natural  and  prepared 
foods  and  give  employment  perhaps  to  millions  of 
men  and  women  throughout  the  land.  Then  there 
are  to  be  considered  those  engaged  in  the  mining  of 
tin,  the  manufacture  of  glass  and  tin  vessels,  boxes, 


358     The  Place  of  Agriculture  in  Reconstruction 

bags  of  various  materials,  labels  for  the  goods,  wrap- 
ping paper,  string,  and  many  other  things — all  of 
which  are  not  only  used  for  the  proper  delivery  of 
natural  and  prepared  foods  into  our  homes,  but  the 
raw  materials  of  which  are  also  largely  the  product 
of  forest  and  farm.  Let  any  one  walk  through  the 
streets  of  a  city  and  note  the  number  of  stores  and 
variety  of  food  supplies  offered  for  sale  and  think 
what  it  would  mean  to  the  people  who  earn  their  liv- 
ing by  the  distribution  of  these  goods  to  consumers 
if  this  supply  was  shut  off  or  diminished  to  any  great 
extent  by  crop  failure  or  an  insufficient  number  of 
farm  workers.  The  economic  and  social  effect  would 
be  to  throw  a  large  number  of  people  out  of  employ- 
ment. Simply  to  call  attention  to  these  commonplace 
matters  of  our  daily  life  is  to  emphasize  the  great 
importance  of  agriculture  as  a  primary  industry  to 
our  economic,  social  and  national  welfare. 

Passing  from  foods  both  natural  and  prepared,  let 
us  glance  at  the  single  farm  product,  tobacco,  which 
cannot  be  classed  as  a  necessity,  but  which  probably 
is  more  generally  used  as  a  luxury  than  any  other 
thing  grown.  It  is  used  by  rich  and  poor  alike.  In 
1918  there  were  raised  on  our  farms  1,266,686,000 
pounds  of  tobacco,  having  a  farm  value  of  about  half 
a  billion  dollars.  When  manufactured  into  the  vari- 
ous tobacco  products  their  value  mounts  up  into  the 
billions  of  dollars.  Here  again  vast  factories  and 
small  individual  firms  employ  tens  of  thousands  of 


The  Reconstruction  of  Agriculture       359 

workers  in  the  direct  manufacture  of  these  goods. 
Then  there  are  the  related  industries  which  produce 
such  accessories  as  jars,  cans,  bags,  pipes,  cigarette 
paper,  matches,  and  many  other  things  which  aid  in 
the  marketing  and  distribution  of  tobacco  and  its 
products.  The  ramifications  of  this  one  agricultural 
crop  into  the  industrial  and  commercial  world  with 
its  hosts  of  workers  make  it  one  of  the  greatest  em- 
ployers of  labor  and  capital  indirectly  connected  with 
farm  production.  It  would  be  an  economic  and  social 
calamity  indeed  if  the  tobacco  worm  and  wilt,  if 
drouth  and  other  natural  forces  should  destroy  or 
even  partially  ruin  this  crop  for  a  single  season. 
Unemployment  would  surely  stalk  abroad  with  pov- 
erty and  distress  as  its  accompanying  consequences. 
What  is  true  of  agriculture  in  the  matter  of  food 
and  luxuries  is  equally  applicable  to  the  textile, 
leather,  paper,  and  lumber  trades  and  industries. 
Here  again  the  raw  products  from  farms  and  for- 
ests necessitate  the  employment  of  millions  of  peo- 
ple and  the  use  of  vast  quantities  of  rolling  stock, 
machinery,  factories  and  shipping  to  prepare  and 
carry  raw  materials  and  manufactured  goods  to  our 
own  people  and  to  foreign  markets.  Think  of  the 
vast  quantities  of  hemp,  linen,  cotton  and  wool  goods 
manufactured  and  sold,  which  enter  into  every  home 
either  as  necessities  or  comforts  of  life.  Think  also 
of  the  vast  number  of  workers  who  depend  upon  the 
direct  manufacture  of  these  articles  of  use  and  cloth- 


360     The  Place  of  Agriculture  in  Reconstruction 

ing,  to  say  nothing  of  the  thousands  who  earn  their 
daily  bread  in  retailing  them  to  the  entire  popula- 
tion or  who  are  engaged  in  commercial  houses  hav- 
ing to  do  with  their  exportation.  And  again  let  us 
think  of  the  large  number  of  persons  engaged  in  the 
manufacture  and  sale  of  harness,  boots,  shoes,  suit 
cases,  bags,  purses,  and  a  variety  of  other  leather 
goods  useful  and  ornamental  But  all  these  forms  of 
wealth  made  by  the  transformation  of  farm  products 
deteriorate  by  use  and  need  reconstruction  or  re- 
placement from  time  to  time. 

Following  out  these  processes  more  remotely  still, 
the  manufacture  of  agricultural  raw  materials  into 
useful  and  ornamental  goods  gives  employment  to  a 
host  of  miners  who  are  engaged  in  digging  from  the 
bosom  of  mother  earth  the  coal,  iron,  and  various 
metal  ores  now  so  much  needed  for  the  operation  of 
machinery,  the  manufacture  of  goods,  and  the  con- 
struction of  tools  and  machinery  in  our  modern  in- 
dustries. Forms  of  wealth  innumerable  are  thus 
manufactured  to  be  sold  at  home  or  shipped  abroad. 
But  what  would  be  the  use  of  rolling  stock  on  our 
railroads  if  the  wealth  of  agriculture  was  not  pro- 
duced to  be  transported?  Or  what  would  be  the  use 
of  shipping  if  we  had  no  forms  of  agricultural  wealth 
to  carry  to  the  Indies?  Is  it  not  plain  that  agri- 
culture offers  a  field  of  boundless  opportunity  for 
the  employment  of  labor  and  has  a  general  relation 
to  our  national  welfare  1  And  is  it  not  evident  that 


The  Reconstruction  of  Agriculture       361 

should  agriculture  wane  our  national  prosperity 
would  wane  also?  For  these  reasons  and  many 
others  the  place  of  agriculture  in  reconstruction  is 
to  aid  in  readjusting  the  labor  forces  to  a  peace  basis 
and  to  prevent  unemployment  as  much  as  possible, 
the  dread  of  which  at  present  is  the  awful  nightmare 
of  the  civilized  nations  of  the  world. 

A  Vision  of  the  Future 

Whither,  then,  as  a  nation  are  we  going!  Over 
the  brink  or  on  the  main  road  to  prosperity?  The 
answer  will  depend  in  no  small  degree  upon  our 
future  attitude  toward  agriculture. 

Before  us  lies  the  immediate  task  of  adjusting  the 
power  of  the  people  to  the  production  of  wealth. 
The  war  has  disturbed  our  economic  relations  and 
has  involved  us  in  debt,  the  interest  on  which  must 
be  paid  annually,  and  in  due  time,  it  is  to  be  hoped, 
the  debt  itself.  The  latter  can  be  accomplished  best 
by  the  creation  of  a  sinking  fund  out  of  the  in- 
creased wealth  of  the  nation.  But  the  determining 
factor  of  national  wealth  production  is  the  encour- 
agement of  all  forms  of  economic  activity — agricul- 
ture, industry,  trade  and  commerce. 

The  foundation  of  our  future  prosperity  lies  pri- 
marily in  the  production  of  wealth  from  the  soil. 
That  portion  of  the  people  who  engage  in  this  indus- 
try must  earn  enough  to  live  decently  and  save 
enough  to  meet  taxes  and  interest  or  the  inducements 


362     The  Place  of  Agriculture  in  Reconstruction 

to  labor  are  removed.  And  what  is  true  of  farm 
workers  is  true  of  all  workers  engaged  in  the  pro- 
duction of  wealth.  The  nation  as  a  whole  has  a  goal 
before  it,  namely,  the  maintenance  of  a  high  stand- 
ard of  living  and  the  accumulation  of  surplus  wealth 
with  which  to  pay  taxes  needed  to  meet  interest  on 
the  national  debt,  to  create  a  sinking  fund  to  redeem 
it,  and  to  pay  current  public  expenditures.  On  the 
outcome  of  these  efforts  in  wealth  production  will 
depend  the  future  prosperity  of  our  nation.  For  the 
earth  and  the  fulness  thereof,  with  all  its  marvelous 
resources  for  wealth  production,  is  still  open  to  those 
who  will  labor.  And  it  is  wonderful  how  the  soil  will 
respond  to  the  touch  of  man  in  cooperation  with  na- 
ture in  providing  the  means  of  support  for  an  en- 
tire people  and  in  creating  the  raw  materials  for 
many  of  our  economic,  industrial  and  commercial 
activities.  The  broad  acres  of  fields  and  forests  still 
remain  the  primary  sources  of  wealth  production  for 
the  sustenance,  the  comfort,  and  the  welfare  of  our 
people. 

From  the  experience  of  the  past  we  are  able  to 
judge  of  the  future.  If  the  wealth  of  agriculture  is 
produced  in  greater  abundance  than  before  and  is 
devoted  to  the  reconstruction  of  the  normal  economic 
and  social  life  of  our  people,  the  elements  of  prog- 
ress and  prosperity  are  within  our  reach.  But  in  this 
vision  it  is  inevitable  that  agriculture  shall  stand  in 
the  forefront  of  national  progress.  As  an  industry 


The  Reconstruction  of  Agriculture       363 

it  offers  the  best  means  of  re-adjusting  the  changed 
relations  of  national  life  in  all  their  complexity. 
Primarily  our  population  must  be  fed  and  clothed, 
warmed  and  sheltered.  Then  with  the  raw  materials 
of  many  industries  produced  by  the  cultivation  of  the 
soil  and  the  raising  of  live  stock,  the  wheels  of  nu- 
merous industries  will  turn  once  more  and  the  people 
will  not  suffer  long  from  unemployment  during  the 
reconstruction  period.  Many  goods  will  thus  be 
manufactured  for  which  there  is  an  absolute  need 
and  which  will  give  employment  to  countless  thou- 
sands of  our  population. 

An  abundance  of  food  products  is  first  needed  be- 
cause they  are  essential  for  maintaining  life  and  pre- 
venting physical  suffering.  No  cry  is  so  distressing 
as  the  cry  of  our  hungry  children.  Our  nation  and 
every  nation  must  have  bread  and  meat,  fruits  and 
vegetables,  butter  and  cheese,  eggs  and  poultry,  and 
numerous  other  food  supplies  which  agriculture 
alone  can  produce.  Then  the  industrial  world  will 
need  flax  and  hemp,  cotton  and  wool,  hides  and  lum- 
ber— the  raw  materials  and  the  finished  products  of 
a  hundred  things  which  enter  into  our  daily  life  and 
furnish  us  with  employment.  We  must  have  food 
twice  or  three  times  a  day.  "Give  us  this  day  our 
daily  bread "  is  no  idle  prayer.  It  is  the  famished 
cry  of  the  human  race;  it  has  been  echoing  down 
through  the  ages;  it  is  the  fundamental  biological 
fact  of  all  organic  creation ;  it  is  the  first  and  the  last 


364     The  Place  of  Agriculture  in  Reconstruction 

demand  of  every  sentient  being  which  springs  into 
life  and  enters  upon  the  struggle  for  subsistence. 
From  its  demands  no  human  being  can  escape.  All 
other  forms  of  wealth  are  well-nigh  worthless  as 
measured  by  the  universal  demand  for  food. 

Still,  besides  the  need  of  food,  as  civilized  beings 
we  must  have  clothes  and  household  goods  and  we 
must  have  shoes  on  our  feet.  But  the  raw  materials 
for  the  manufacture  of  all  these  goods  come  from  the 
soil.  When  worked  up  into  finished  products  by  the 
application  of  labor  and  capital,  they  enter  into  our 
standard  of  living  and  furnish  us  the  comforts  and 
luxuries  of  life.  These  necessary  demands  must  be 
supplied  and  the  only  means  of  producing  them  is  by 
cultivation  of  the  soil. 

Not  only  the  demands  of  our  own  people  must  be 
supplied  for  all  essential  goods  through  the  ordinary 
channels  of  domestic  industry  and  trade,  but  the 
calls  of  other  nations  upon  our  resources  will  doubt- 
less continue  for  many  years.  The  outlook  for  in- 
dustry, trade  and  commerce  is  wonderful  if  land 
settlement  and  agriculture  are  carefully  and  proper- 
ly organized.  This  is  the  problem  which  confronts 
us.  To  meet  it  intelligently  and  patriotically  is  not 
only  to  provide  for  the  welfare  of  our  own  nation, 
but  it  will  enable  us  to  send  surplus  food  supplies 
and  raw  materials  of  manufactures  to  other  coun- 
tries. This  will  encourage  commerce  as  never  be- 
fore in  the  history  of  our  country. 


The  Reconstruction  of  Agriculture       365 

The  call  of  agriculture,  therefore,  is  imperative. 
There  will  be  a  growing  demand  for  land,  labor  and 
capital.  The  period  of  readjustment  is  upon  us  and 
will  long  continue.  Our  young  men,  returning  to 
their  own  land  once  more,  will  find  agriculture  in  all 
its  phases  ready  to  enlist  their  energies  in  the  pro- 
duction of  wealth.  They  may  enlist  for  the  growing 
of  food  products,  the  raising  of  live  stock,  or  the  pro- 
duction of  raw  materials  for  the  textile  and  other  in- 
dustries. They  may  again  play  an  important  part  in 
peace  as  in  war  in  supporting  their  country, — in  the 
reconstruction  of  our  national  life. 

But  this  work  can  not  be  satisfactorily  performed 
without  abundance  of  land,  labor  and  capital.  These 
are  the  fundamental  factors  of  wealth  production. 
In  relation  to  the  problem  of  demobilization,  which 
will  provide  an  abundance  of  labor,  the  task  of  fu- 
ture state  and  federal  legislation  is  to  prepare  the 
way  for  supplying  land  and  capital.  The  need  for 
rural  credits  has  been  enlarged.  That  need  can  be 
measured  only  by  the  ability  of  agriculture  to  absorb 
a  vast  host  of  laborers  who  are  willing  to  enter  upon 
farm  life  and  exert  themselves  in  the  production  of 
the  forms  of  wealth  which  satisfy  to  the  utmost  our 
individual  and  our  national  needs. 

Our  task  has  been  to  formulate  a  program  of  ac- 
tion. To  help  carry  such  a  program  out  is  a  task 
which  should  appeal  to  every  intelligent  soldier  and 
civilian  who  has  a  vision  of  a  progressive  nation  and 


366     The  Place  of  Agriculture  in  Reconstruction 

who  is  content  to  play  a  minor  part  if  need  be  in  the 
new  drama  of  our  unfolding  and  enlarging  national 
life. 

In  this  drama  of  national  progress  and  prosperity, 
the  great  industry  of  agriculture  must  play  a  leading 
role.  With  peace  restored  there  will  begin  a  new 
epoch  in  the  uplift  of  the  human  race ;  a  new  stand- 
ard of  individual  and  national  life  and  liberty  will 
be  set  up.  The  sword  will  be  sheathed;  the  plowshare 
must  take  its  place.  Human  forces  turned  from  the 
paths  of  destruction  must  be  guided  into  the  fields  of 
production  and  construction.  And  here  we  may,  if 
we  will,  behold  a  vision  of  the  goddess  of  agricul- 
ture, with  outstretched  arms,  bidding  her  children 
welcome  to  her  breasts,  for  mother  Earth  stands 
ever  ready  to  feed  and  clothe  and  warm  the  sons  of 
men  with  her  life 's  blood. 

The  best  thought  of  our  best  thinkers  on  rural 
subjects  must  be  given  to  the  development  of  a  pro- 
gram which  will  meet  all  these  requirements  and 
must  strive  to  put  them  into  practise.  Our  thinkers: 
must  peer  into  the  future;  they  must  feel  the  need, 
of  a  new  civilization ;  they  must  foresee  that  the  way 
of  agriculture  leads  to  national  prosperity.  To  carry 
out  such  a  program  is  worthy  of  the  best  efforts  that 
true  patriotism  can  bestow  upon  the  task. 

This  can  be  done.  It  should  be  done  without  de- 
lay. The  need  is  great.  The  call  of  our  country  is 
imperative.  A  national  program  should  be  devel-* 


The  Reconstruction  of  Agriculture       367 

oped,  one  born  of  undying  patriotism.  "We  owe  it  to 
our  soldiers,  to  our  country,  to  long-suffering  hu- 
manity. Such  a  program  gives  us  a  vision  of  the 
future :  A  better  and  a  wealthier  country — a  peace- 
ful and  a  happy  world ! 

Behold !  a  new  agriculture  and  the  earth  anew ; 
With  no  more  war,  nor  is  there  sorrow  nor  crying, 
But  peace  and  plenty.     'Twas  of  this,  with  sighing, 
A  vision  men  have  had  with  everlasting  longing. 
For  now  God  reigns,  with  love  as  His  evangel, 
And  Social  Justice  pays  man's  wage  in  full! 


THE  END 


INDEX 


Afforestation  of  land,  6 
Agrarian  struggles  in  Rome,  39 
Agricultural  colleges,  results  of, 

314 

credit  banks  in  France,  139 
development,    promotion    of, 

302 
experiment    stations,    results 

of,  314 

training  for  soldiers,  21,  56 
Agriculture,  as  affected  by  taxa- 
tion   and    interest    rates, 
346 
in    reconstruction,    31,    220, 

348,  365 

minimum  wage  in,  66 
precariousness  of,  328,  333, 

335 

relation  to  national  welfare, 
281,  348,  354,  358,  361,  366 
sources  of  credit  for,  283 
systematic    courses    in,    153, 

171 

use  of  soldiers  in,  7 
wealth  of,  352,  356,  362 
Amortization  of  farm  loans,  123, 

127,  130,  295,  322,  323 
Animal    husbandry    for   soldiers, 

153 

Australia,  control  of  farm  lands 
in,  234,  235 

Bee  keeping  for  disabled  men,  62, 
156 

Belgium,  rehabilitation,  19 

Belle  Fourche  project,  farms  on, 
233 

British  government,  indebtedness 
of,  14 

British   Labor   Party,   land  pro- 
gram, 8,  45 
membership,  7 


California,  control  of  farm  land 

in,  242 
Canada,  land  settlement  problem, 

146,  178,  228 
free  land  for  soldiers,  164 
labor  problems  in,  20 
Land  Settlement  Act,  159 
training   of   soldiers  in,   21, 

148 

unused  farm  lands  in,  226 
Capital      requirements      on      re- 
claimed farms,  212 
Children  in  France,  subsidies  for, 

133 
Cities,  causes  of  over-population, 

276 
Civilians,   injured,   loans   to,   92, 

100 

Climate  of  the  United  States,  184 
Communities,  rural  ideal,  244 
County  agents  as  farm  instruct- 
ors, 315 
Credit    conditions    for     soldiers, 

172,  175 
for     successful     agriculture , 

283 

mortgage,  for  soldiers,  293 
personal,    for    soldiers,    297, 
317 

Dairying  for  soldiers,  59, 155, 194 
Denmark,  land  credit  system  in, 

294 
Drouth     areas     in     the     United 

States,  329 

Elevator  agents  in  Canada,  157 
England,  cultivated  areas  in,  70 
land  for  settlement  in,  50 


Farm  families,  encouragement  in 
France,  96,  133 


369 


370 


Index 


Farm      improvements,     payment 

for,  by  soldiers,  210 
instructors,  county  agents  as, 

315 
labor,     economic     merit     of, 

257,  259 
labor  problem,  basis  of,  274, 

280 
labor      problem      in      Great 

Britain,  79 
labor  problem,  tenant's  view 

of,  277 
laborers,  acquiring  of  farms 

by,  269 
laborers,     supply     of,     193, 

252 
lands,  control  of,  234,   235, 

242,  243 
lands,    irrigated,    in    United 

States,  231 
lands,  taxation,  262 
lands,  unused,  State  control 

of,  224,  226,  234 
lands,  value  of,  269 
loan  bonds,  issue,  338,  341, 

343 
loans,  amortization  of,   123, 

127-130,  295,  322,  323 
mortgage  credit  for  soldiers, 

293,  295,  297,  342 
mortgage  credit  in  Denmark, 

294 
mortgage   credit  in   France, 

89,  103,  141 
mortgage      credit,      unusual 

features  of,  336 
mortgage  indebtedness,  318, 

319,  321 

mortgage  loans,  340 
mortgage   rates  of   interest, 

320,  345 

occupants,  classes  of,  73 
ownership,    relation    to    ten- 
ancy, 271 

property,  value,  310 
tenancy,  basis  of,  280 
tenancy,  economic   merit  of, 

257,  260,  262,  265,  271 
tenant's  view  of  labor  prob- 
lem, 277 


Farm  work  for  disabled  men,  58 

workers,  soldiers  as,  253 
Farmers,    Canadian    soldiers    as, 
169 

government  aid  to,  330 

indebtedness  of,  317,  319 

personal  loans  for,  317 

Eoman  soldiers  as,  33,  38 

tenant,    acquiring    of    farms 
by,  269 

tenant,  future  supply  of,  252 
Farming  for  soldiers,  194 

risks  in,  328,  333,  335 
Farms,     abandoned,     in    United 
States,   229 

acquiring  ownership  of,  269, 
271 

acreage  in  cultivation,  185 

irrigated,  in  United  States, 
231,  286 

mortgaged,  in  United  States, 
318 

profit-sharing,  in  Great  Brit- 
ain, 54 

rational   system   of   renting, 
268 

reclaimed,     capital     require- 
ments on,  212 

reclaimed,  failures  on,  288 

reclaimed,    short-time    loans 

on,  214 

Federal    Board    for    Vocational 
Education,  26 

Farm  Loan  System,  179,  325, 
327,  336,  338,  339,  343 

Land  Banks,  capital  of,  340 
Field  husbandry  for  soldiers,  155 
Financial   aid   to    disabled   men, 
62,  65 

prospects      on      reclamation 

projects,  284 
Forestry  for  disabled  men,  59 

minimum  wage  in,  66 
France,  agricultural  credit  banks 
in,   139 

encouragement  of  farm  fam- 
ilies in,  96 

farm  mortgage  credit  in,  89, 
103 

homestead  law  of,  89 


Index 


371 


France,    insurance   premiums   on 

loans  in,  125 

land  credit  societies  in,  141 
land  settlement  decree,  98 
land    settlement   in,    87,   91, 

143 
land  settlement  law,  91,  108, 

111,  135 
loans  to  disabled  men  in,  92, 

100,  112,  123 
reconstruction  in,  16 
small  holdings  in,  87 
subsidies  for  children  in,  133 
unseizable  homesteads  in,  134 
vocational  training  in,  19 
Fruit  growing  for  disabled  men, 

61 


Gardening  for  soldiers,  194 
Government    administration, 

economy  in,  302,  304 
aid  to  farmers,  330 
disbursements,     increase     in, 

306 
funds   for  loans  in   France, 

103,  137 
Gracchi,    agrarian    proposals   of, 

40 

Grain  buyers  in  Canada,  157 
Great   Britain,    classes    of    farm 

occupants,  73 
farm  labor  problem  in,  79 
land  areas  in,  69 
land  settlement  in,  45,  50,  52, 

68,  81 

profit-sharing  farms  in,  54 
rent  of  farm  land  in,  78 
training  of  soldiers  in,  56 
value  of  farm  lands  in,  71, 
72 

Homestead  law  in  France,  89 

Homesteads,  unseizable,  in 
France,  134 

Horticultural  training  for  sol- 
diers, 56,  60,  153 

Hours  of  work  for  disabled  men, 
65 

Huntley  project,  farms  on,  232 


Ideal  rural  communities,  outline 

of,  244 

Indebtedness  of  agriculture,  317 
of  British  government,  14 
of  United  States,  345 
on  farms,  refunding,  321 
relation  to  taxation,  48 
Industrial   training  for  soldiers, 

21 

Industries,     proposed     socializa- 
tion, 8 
relation  to  agriculture,  358, 

359 

Insurance  premiums  on  loans,  125 
Interallied    socialist    conference, 

program,  4 
Interest,  burden  of,  321,  322,  324, 

327 

Interest  rates,  effect  on  agricul- 
ture, 346 

rates  on  farm  loans,  92,  98, 
345 

Joint  congressional  committee  on 

reconstruction,  26 
Joint   stock  land   banks,   capital 

of,  341 
Jugerum,  land  measurement,  40 

Labor  conference,  program  on  la- 
bor adjustments,  4 
forces,  adjustment,  2 
problems,    intensified   phases 

of,  1,  20 

unions,  British,  views  on  re- 
construction, 7 
Laborers,     farm,     acquiring     of 

farms  by,  269 
farm,  supply  of,  193,  252 
unskilled,  supply  of,  193 
Land,  afforestation,  6 

allotments     to     Roman     sol- 
diers, 35 

areas  in  Great  Britain,  69 
areas  in  United  States,  184 
available   for   farming,   186, 

192 

cost  on  reclamation  projects, 
197 


372 


Index 


Land,  credit.     (See  Farm  mort- 
gage credit.) 
free,  in  Canada,  164 
free,  in  United  States,  186 
policy  for  soldiers,   188 
policy  progressive,  223,  248 
program    of    British    Labor 

Party,  8,  45 
reclaimed,       repayment       of 

loans  on,  206,  216 
reclamation,    6 
Settlement   Act   of    Canada, 

159 

Land  settlement,  by  Roman  sol- 
diers, 32 

control  of,  237,  240,  242,  243 
decree  in  Trance,  98 
government    cooperation    in, 

200,  205 
in  Canada,   146 
in  France,  87,  91,  143 
in  Great  Britain,  45,  50,  68, 

81 

in  United  States,  181 
law  in  France,  91,  108,   111, 

135 

problem,  complexity  of,  42 
problem  in  Canada,  178,  228 
progressive  policy  of,  219 
schemes,  victims  of,  238,  241, 

250 

Land  system  of  Rome,  36 
Latifundia,  origin  and  meaning, 

39 

Loans,  conditions  of,  172,  175 
government   funds   for,    103, 

137 

on    reclaimed    lands,    repay- 
ment, 206,  216 
partial  payments  on,  130 
short-time,       on       reclaimed 

farms,  214 

to  disabled  men,  92,  100,  112, 
123,  125 

Market    gardening    for    disabled 

men,  61 

Men,  disabled.     (See  Soldiers.) 
Minimum    wage    in    agriculture, 

66 


National    progress,    relation    to 

agriculture,  366 
welfare,  basis  of,  361 
welfare,  relation  to   agricul- 
ture,   281,    348,    354,    356, 
361 

New    Zealand,    control    of    farm 
lands  in,  228,  234,  235 

North     Carolina,     unused     farm 
lands  in,  224 

North  Platte  project,  farms  on, 
233 

Occupational  therapy  for  soldiers, 

148 

Poultry  raising  for  soldiers,  61, 

155 
Proletariat,  origin  and  meaning, 

33 
relation    to    Roman    soldiers, 

38,  41 
Public  works,  employment  on,  4, 

6 

Reclamation    outlook    in    United 

States,  198 
Reclamation  projects,  cost  of  land 

under,   197 

employment  on,  257,  265 
financial  prospects  on,  284 
requirements   of   settlers  on, 

287 
Reconstruction,  agriculture  in,  31, 

220,  348,  365 

in  devastated  countries,  15 
joint    congressional    commit- 
tee on,  26 

Rent  of  farm  land  in  Great  Brit- 
ain, 78 
Rome,  agrarian  struggles  in,  39 

land  system  of,  36 
Rural  communities,  ideal,  244 
Rural    credits   for    soldiers,    288, 

291,  301 
credits  in  United  States,  310, 

317 

depopulation,  causes,  276 
depopulation,  remedy,  347 


Index 


373 


Rural    extension    service    move- 
ment, 316 

life  conditions,  improvement, 
311,  325,  349 

Sailors.     (See  Soldiers.) 
Scotland,  land  for  settlement  in, 

50 
Scriptura,  tax  for  grazing  land, 

37 

Serbia,  rehabilitation,  19 
Settlers,    requirements    on    recla- 
mation projects,  212,  287 
Shoshone  project,  farms  on,  233 
Small     holding     settlements     in 

Great  Britain,  52 
Small   Holdings   and   Allotments 

Act,  71,  74,  82 
Small  Holdings  Colonies  Act,  50, 

85 

Small  holdings  in  France,  87 
Social  life,  outlook  on,  29 
Soil,  wealth  production  from,  361 
Soldier  Settlement  Act,  proposed, 

201 
Soldiers,  agricultural  courses  for, 

153,   157,  171 
amortized  loans  for,  295 
as  farm  workers,  253 
Canadian,  as  farmers,  169 
Civil     Reestablishment     De- 
partment, 22 

disabled,  loans  to,  92,  100 
disabled,  work  for,  57 
employment  in  public  works, 

4,  7 
farming  and  gardening  for, 

194 
federal  system  of  loans  for, 

342 

financial  aid  for,  62,  65,  148 
free  land  for,  164 
land  settlement  for,  181 
new  land  policy  for,  188 
payment  for  farm  improve- 
ments by,  210 
personal     credit     for,     297, 

317 

Roman,    allotments    of    land 
to,  35 


Soldiers,  Romans,  as  farmers,  33, 
38 

Roman,  land  settlement  by, 
32 

Roman,  relation  to  proletar- 
iat, 38,  41 

rural   credits   for,    172,   288, 
291,  293,  301 

vocational   training   for,    19, 
21,    24,    56,    62,    65,    148, 
194 
Sun  River  project,  farms  on,  232 

Taxation,   effect   on    agriculture, 

346 
for  agricultural  development, 

302,  314,  316 
of  farm  lands,  262 
relation  to  indebtedness,  48 
Tenant     farmers,     acquiring     of 

farms  by,  269 
farmers,    future    supply    of, 

252 

Therapy,    occupational,    for    sol- 
diers, 148 
Towns,  causes  of  over-population, 

276 

Truckee-Carson     project,     farms 
on,  233 

Uncompahgre      Valley      project, 

farms  on,  232 

Unemployment,  danger  of,  182 
prevention,  5,  10,   255,  285, 

347,  361 
United  States,  abandoned  farms 

in,  229 

control  of  farm  lands  in,  235 
danger  of  unemployment  in, 

182 
Department   of    Agriculture, 

expenditures,    307 
Federal  Farm  Loan  System, 

179 

free  land  in,  186 
indebtedness,  345 
irrigated  farm  lands  in,  231 
land  areas  and  climate,  184 
land  settlement  in,   181 
mortgaged  farms  in,  318 


374 


Index 


United  States,   reclamation   out- 
look in,  198 

rural  credits  in,  310,  317 
unused  farm  lands,  226 
vocational  training  in,  24 


Vectigal,  share  rent  for  land,  36 
Vocation       Education,       Federal 

Board  for,  26 
Vocational  training  for  soldiers, 

19,  21,  24,  56,  194 


Wages,  maintenance  of  standard 

rates,  4 

minimum,  in  agriculture,  66 
of  disabled  men,  65 
Wales,  cultivated  areas  in,  70 
land  for  settlement  in,  50 
Wealth  production  from  the  soil, 

361 

Wyoming,  control  of  farm  lands 
in,  243 

Yuma  project,  farms  on,  231 


14  DAY  USE 

RETURN  TO  DESK  FROM  WHICH  BORROWED 

LOAN  DEPT. 

This  book  is  due  on  the  last  date  stamped  below,  or 

on  the  date  to  which  renewed. 
Renewed  books  are  subject  to  immediate  recall. 

KEC'D  L.L 

JIM  1  9 


DCCl  '6/1. 


ts7n4 


WCD  CIRC  DI 


JUN       8 '74  70 


LD  2lA-40m-ll,'63 
(E1602slO)476B 


General  Library 

University  of  California 

Berkeley 


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UNIVERSITY  OF  CALIFORNIA  LIBRARY 


